Grove Worldwide and Skyjack Inc., two of the industry's largest aerial work platform manufacturers, have created a "strategic alliance" in hopes of boosting their combined market position to a clear No. 3, behind JLG and Genie.
The alliance covers marketing, selling and providing support of each others' products to North American rental customers. The agreement also provides for joint supply and manufacture of scissors and booms, and an agreement for distribution of each company's products through its respective existing distribution channels.
Contrary to rumors of a merger between the Pennsylvania-based Grove and Ontario-based Skyjack, the agreement combines each company's resources "without an equity exchange," according to Jeff Bust, chairman and CEO of Grove Worldwide. Final negotiations will be completed in April.
Executives from both companies underscored that the alliance is not a first step toward a full merger. "We have no intentions right now to purchase Skyjack," Bust said.
"Because of Skyjack's strength in scissors products and Grove's strength in boom products, this alliance is a totally complementary fit for both companies," Bust said. "Our plans are to negotiate a set of agreements for joint support of each company's products, merge our combined product offerings to form a joint venture dedicated toserving the large rental companies as a single point of contact. It allows us to compete head-to-head with JLG and Genie."
Grove's total revenues last year were $781 million, $164 million of which was aerial-related. Skyjack reported 1999 revenues of about $191 million (U.S.), all of which came from lift products.
Each company will retain its own identity but will share and coordinate marketing, sales and product support services.
