WESTPORT, Conn., Mar 11, 2010 (BUSINESS WIRE) -- Terex Corporation (NYSE: TEX) announced today that it has entered into an agreement to divest the Terex Atlas heavy construction equipment, which is located in Ganderkesee, Germany, and knuckle-boom crane and related components businesses, which have operations in Vechta and Delmenhorst, Germany. Also included as part of this transaction are the sales and service business located in Bradford, United Kingdom, and the Terex minority ownership position in the Atlas Chinese joint venture. Terms of the transaction are not being disclosed, although the business is being divested with an agreed-upon amount of capital to be transferred with the business. The transaction, subject to customary closing conditions and regulatory approvals, is expected to close in the second quarter of 2010.
"The Atlas divestiture is another important step forward in the strategic repositioning of Terex," said Ron DeFeo, Terex Chairman and Chief Executive Officer. "We acquired the Atlas business in 2001 with the intention of having a quality full-size excavator as part of a globally competitive portfolio of construction equipment. Our goal was to grow the regionally strong Atlas excavator product as part of this strategy, but we were, for various reasons, never able to achieve the product cost advantage required for it to be successful. Despite restructuring attempts, the tough economic conditions in 2009 resulted in an operating loss for this business in excess of $61 million on sales of approximately $194 million, with approximately two-thirds of the loss coming from the construction products."
Product lines being divested in the transaction include crawler, wheel and rail excavators, knuckle-boom truck loader cranes and Terex(R) Atlas branded material handlers. The transaction also includes the Terex Atlas UK distribution business for truck loader cranes in the United Kingdom. The Atlas business is reported in the Terex Construction segment, with the exception of the knuckle-boom truck loader cranes, which is reported in the Terex Cranes segment.
Terex compact equipment made in Germany, namely mini and midi-excavators and compact wheel loaders, as well as the Terex Fuchs(R) material handler line, will remain with Terex as part of the Construction business segment. Also not part of the transaction are Terex(R) rigid and articulated trucks, backhoe-loaders and other products manufactured in the United Kingdom.
The approximately 800 team members in Germany and the UK that are employed by the businesses being divested will have their employment transfer to the new owner. Additional information regarding the transfer will be provided to employees and their representatives, where provided for under local laws.
Terex Corporation is a diversified global manufacturer operating in four business segments: Terex Aerial Work Platforms, Terex Construction, Terex Cranes, and Terex Materials Processing. Terex manufactures a broad range of equipment for use in various industries, including the construction, infrastructure, quarrying, surface mining, shipping, transportation, energy, refining and utility industries. Terex offers a complete line of financial products and services to assist in the acquisition of Terex equipment through Terex Financial Services. Terex uses its website to make information available to its investors and the market at http://www.terex.com.
This press release contains forward-looking information based on the current expectations of Terex Corporation. Because forward-looking statements involve risks and uncertainties, actual results could differ materially. Such risks and uncertainties, many of which are beyond the control of Terex, include those factors that are more specifically set forth in the public filings of Terex with the Securities and Exchange Commission. Actual events or the actual future results of Terex may differ materially from any forward looking statement due to those and other risks, uncertainties and significant factors. The forward-looking statements speak only as of the date of this press release. Terex expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement included in this press release to reflect any changes in expectations with regard thereto or any changes in events, conditions, or circumstances on which any such statement is based.
SOURCE: Terex Corporation
Terex Corporation
Mike Bazinet, Director, Corporate Communications, 203-222-6113
Email: michael.bazinet@terex.com
or
Tom Gelston, Vice President, Investor Relations, 203-222-5943
Email: thomas.gelston@terex.com