Terex Terminates Acquisition Discussions with Zoomlion

Terex Corporation TEX revealed discussions with Zoomlion Heavy Industry Science and Technology Co. in respect of the purchase of Terex, either with or without the MHPS segment, were terminated. Following the news, the stock plunged 18 percent in the pre-market trading on Friday According to the company, the sale of its Material Handling and Port Solutions business to Konecranes would proceed. Terex said that the sale of MHPS to Konecranes for about $1.3 billion, which is subject to customary regulatory approvals and the approval of the shareholders of Konecranes, is expected to close in January next year. The company's chairman, David Sachs, said, "The Board of Directors and Management of Terex worked diligently to determine if an appropriate transaction with Zoomlion, beneficial to Terex shareholders, was achievable. Unfortunately, after many months of discussions, Zoomlion was unable to provide a fully financed, binding proposal for the purchase of Terex with or without MHPS. This ends the prolonged period of uncertainty that this process has brought to Terex and its customers, team members and shareholders. The Board is confident in our global management team and with Terex's prospects for the future." Its CEO, John Garrison, added, "The sale of the MHPS business to Konecranes will now proceed. This transaction represents excellent value realization for our shareholders and also provides certainty for our MHPS customers and team members. We expect this sale to be accretive to Terex's earnings per share. The proceeds will significantly reduce Terex's debt levels and improve our balance sheet, providing us with the ability to buy back shares and invest in our remaining businesses. As a 25% shareholder of Konecranes, Terex will be able to share in the synergies and economic upside of the combined MHPS and Konecranes businesses." Shares of the company traded 18 percent down in the pre-market trading on Friday.
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