Terex Corporation has agreed to sell its Demag Mobile Cranes business to Tadano Ltd. for about $215 million.
Demag Mobile Cranes manufactures and sells all terrain cranes and large crawler cranes.
Included in the transaction are the manufacturing facilities in Zweibrucken, Germany as well as multiple sales and service locations. The sale, which is subject to regulatory approvals and other customary closing conditions, is expected to close in mid-2019.
“The Demag Mobile Cranes business has been part of our company for almost two decades and produces world class products,” said John L. Garrison, Terex chairman and chief executive officer.
“The dedicated Demag Mobile Cranes team members have made significant contributions to Terex and to the crane industry. The sale is based on strong industrial logic, as the Demag Mobile Cranes business will become part of a global crane company with complementary products and capabilities. We are pleased to have entered into this agreement with Tadano, a strategic buyer who values the Demag Mobile Cranes brand, technology, distribution network and team members.”
In a letter to Terex customers, Garrison said the company is also in discussions to sell its boom truck, crossover and truck crane product lines.
“We will be in touch with those customers affected by the exit to discuss the transition,” Garrison said in the letter. “Terex will continue to manufacture and support several specialized crane products, including tower cranes, pick and carry cranes, and rough terrain cranes.”
Tadano President and Chief Executive Officer Koichi Tadano said the acquisition positions the company for considerable growth.
“The addition of the well-respected Demag brand of all terrain cranes and large crawler cranes range extends our product lines and options for customers. The addition of the Demag branded mobile crane product lines will enhance our global position in this segment,” Tadano said. “We believe that the Zweibrucken facilities and its global team members, as well as the current distribution partners, are valuable to the future success of the business.”
Alongside the sale of Demag, Terex will also exit the North American mobile crane product lines manufactured at its Oklahoma City facility.
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“These changes will simplify our Oklahoma City operation, which will continue to produce telehandlers and re-manufactured units for our aerial work platforms segment and various products for our materials processing segment,” Garrison said. “Although we are exiting the OKC-based mobile cranes products, we will continue to sell parts, and offer service and support to our customers.”
Terex will continue to manufacture Terex Utilities products at its Watertown, South Dakota facilities. Terex will also continue to manufacture Terex Rough Terrain Cranes for the global market in Crespellano, Italy, Terex tower cranes in Fontanafredda, Italy and Terex pick and carry cranes in Brisbane, Australia.
“These are strong businesses that will continue to be an important part of Terex,” Garrison said. “During these transitions, our global team is committed to providing exceptional service to all of our global customers, including those affected by these changes.”