Chattanooga, Tenn.-based Astec Industries last week announced that it has entered into a definitive agreement to acquire 100 percent of Peterson Inc. located in Eugene, Ore.

Peterson is a manufacturer of whole-tree pulpwood chippers, horizontal grinders and blower trucks. Founded in 1961 as Wilbur Peterson & Sons, a heavy construction company, the company expanded into manufacturing in 1982 to develop equipment to suit its land-clearing and construction needs. By 1990 Peterson had developed its first wood recycling machine and since that time continuous development has led to the existing product line. The company will continue to operate from its Eugene headquarters under the name Peterson Pacific Corp. The transaction is expected to close during the third calendar quarter.

The total purchase price for the acquisition is approximately $34 million. Such amount includes $7 million to payoff outstanding Peterson debt and $7 million to purchase the real estate currently used by Peterson in a separate transaction, but excludes a $3 million potential earn-out payment.

“The acquisition of Peterson adds a new dimension to the range of products manufactured by Astec Industries, Inc.,” said J. Don Brock, chairman and CEO of Astec. “The processing equipment manufactured by Peterson has numerous components that closely resemble those found on our track-mounted crushers and Roadtec milling machines. We believe that we can enhance the operations of Peterson by improving purchasing practices, reducing outsourced assembly items and by using our best practices. Our focus group initiatives are very applicable to Peterson's business. Additionally, the existing leadership team of Neil Peterson, president, and Larry Cumming, CEO, will continue to manage the business after the acquisition.”

Astec Industries’ manufacturing operations are divided into four business segments: aggregate processing and mining equipment; asphalt production equipment; mobile asphalt paving equipment; and underground boring, directional drilling and trenching equipment.