Terex Corp. has entered into a contract to divest its Roadbuilding operations in Brazil and certain mobile roadbuilding product lines in the U.S. to the Fayat Group, owner of compaction equipment manufacturer Bomag and mixing plant business unit subsidiary Marini-Ermont. Product lines being divested include asphalt plants and pavers manufactured in Porto Allegre, Brazil, and assets for the asphalt paver, reclaimer stabilizer and material transfer product lines, which are currently manufactured in Oklahoma City. The transaction is anticipated to close during the first quarter.
“The decision to exit most of our roadbuilding product lines is another step in the repositioning of Terex,” said Ron DeFeo, Terex chairman and CEO. “We continue to focus on improving our Construction segment performance as well as the company’s overall returns on invested capital, and this transaction is part of that process.”
Terex determined that it will be exiting the remaining road-building product lines that it manufactures in Oklahoma City, and has taken charges in connection with the business assets being sold and the remaining Oklahoma City road-building assets to reflect the likely realizable value in a transaction. The amount of these charges that will impact the fourth quarter 2012 results, when reported, is approximately $15 million. Terex will continue manufacturing operations in Oklahoma City for its product lines not affected by this transaction.
“The addition of these product lines enhances the position of Fayat Group as the only full liner in roadbuilding equipment, for long-term success and significant growth potential in the industry,” said Jean-Claude Fayat, Fayat Group executive managing director. “Moreover, it accelerates our footprint in emerging countries.”
The acquisition will position Bomag to offer a broad range of roadbuilding products and solutions to customers and reinforce the global leadership of Marini-Ermont in the mixing plant segment in Latin America.
In addition, the aging infrastructure of the North American transit system and the development of infrastructure in South America are expected to continue to drive an increasing demand for roadbuilding and compaction equipment.
“We are pleased to announce the agreement and are proud to welcome the Cedarapids and CMI products (asphalt pavers, reclaimer/ stabilizer and material transfer vehicles/devices) and reputable brand images into the Bomag America’s offerings,” said Rob Mueckler, vice-president of sales and marketing. “We intend to fully leverage our collective strengths to more efficiently serve roadbuilding customers”.
Fayat is active worldwide in providing efficient technical solutions for construction and public works, steel construction, electricity, road equipment, handling material and pressure vessels. Fayat is a world leader in compaction through its subsidiary Bomag and a main player in mixing plants with Marini-Ermont.
Bomag offers a broad range of product segments consisting of light equipment, asphalt pavers, cold milling planers, reclaimer/stabilizers and soil, asphalt and landfill compaction equipment.
Terex Corp. is a diversified global manufacturer reporting in five business segments: Aerial Work Platforms, Construction, Cranes, Material Handling & Port Solutions and Materials Processing.