Wacker Construction Equipment AG, Neuson Kramer Baumaschinen AG and the main shareholders of NKB Austria signed an agreement Sept. 23 to merge the two companies. The merger is expected to close in October, creating a major global manufacturer of light and compact equipment with more than 160 sales and service stations.

The companies are both profitable family-run companies, with Neuson Kramer strong in the compact segment, including mini-excavators, wheel and telescopic loaders, with Wacker particular strong in light equipment including concrete saws, trowels, generators and more.

“This merger is motivated by the desire to grow, and we see high potential in uniting our global sales and service network with Neuson Kramer’s outstanding compact equipment offering,” said Dr. Georg Sick, chairman of the executive board of Wacker. “By enhancing our product portfolio as well as services and continuing regional growth, we are eager to fulfill the expectations of capital market experts, who expect the merged company to exceed the billion-euro revenue mark over the coming year.”

“The high-quality portfolios of both companies complement each other ideally without overlapping,” added Hans Neunteufel, CEO and founder of NKB. “So rather than reducing headcount and capacity, the merger will enable us to expand.”

Sick will retain his present role as CEO within the new company. Current members of the NKB executive board Martin Lehner — responsible for the compact equipment segment — and Gunther Binder (future CFO), will be appointed to the Wacker executive board. Neunteufel will be appointed chairman of the supervisory board.

Thanks to high demand for their products and services, both companies reported growth over the first half of their respective fiscal years. Wacker’s results were in line with projections, with group-wide sales up 8.1 percent in the first half of 2007 to €341.7 million (about U.S. $482.7 million). Discounting currency effects, that number is an 11.5-percent year-over-year increase. EBITDA rose 0.8 percent to €55.3 million (about U.S. $78.1 million), a 15.1-percent jump. Group-wide sales at NKB jumped 30.4 percent in the first half of fiscal 2007-2008 to reach €181.2 million (about U.S. $256 million), while EBITDA rose 39 percent to €36.8 million.

The merger was approved by anti-trust authorities in Germany and Austria in May. Beginning this week, Wacker is listed on the SDAX.