Terex Corp. last week announced that it has agreed on a term sheet to acquire the port equipment businesses of Fantuzzi Industries and Noell Crane for net consideration of approximately €175 million (about U.S. $231.5 million). The Fantuzzi and Noell businesses are global leaders in the design, manufacture, and service of port equipment. Term sheets have also been agreed with the existing financial creditors to the Fantuzzi group for long-term financing on favorable terms to provide substantially all of the funds necessary to complete the transaction. The term sheets are non-binding and it is the intention of the parties to work to enter into agreements and complete the transaction within the next few weeks.
Terex initially announced the acquisition of the Fantuzzi and Noell businesses in August of 2008 for total consideration of approximately €215 million (U.S. $284.4 million) and subsequently announced in December of 2008 that it was terminating the acquisition because of a material adverse change in the Fantuzzi business. After the termination, Fantuzzi disputed the termination and initiated arbitration proceedings against Terex in Italy. However, the parties, together with the lenders to the Fantuzzi and Noell businesses, continued to engage in discussions to resolve the matter.
“Immediately after closing we will begin to work with Fantuzzi’s team members, suppliers, distributors, customers and other stakeholders to aggressively restructure and position these businesses for the eventual recovery in their markets,” said Rick Nichols, president, Terex Cranes.
Phil Widman, senior vice president and chief financial officer, added “Upon completion of this transaction, our debt levels will increase modestly due to the financing provided from the existing financial creditors. With the long-term maturities and expected company-wide cash flow generation, we believe liquidity should be sufficient to get us through the economic downturn.”
Westport, Conn.-based Terex Corp. is a diversified global manufacturer with 2008 net sales of $9.9 billion. Terex operates in four business segments: Terex Aerial Work Platforms, Terex Construction, Terex Cranes, and Terex Materials Processing & Mining. Terex manufactures a broad range of equipment for use in various industries, including the construction, infrastructure, quarrying, surface mining, shipping, transportation, refining and utility industries.