Volvo Buying Terex Truck Business
Volvo Construction Equipment (Volvo CE) has agreed to acquire Terex Equipment Ltd., a manufacturer of off-highway rigid and articulated trucks, from Terex Corp. Volvo CE will pay approximately $160 million for the unit, which includes related assets such as the main production facility in Motherwell, Scotland, a 25.2% share of Inner Mongolia North Hauler Joint Stock Co (NHL), which manufactures and sells rigid haulers under the Terex brand in China, distribution of haulers in the U.S. and intellectual property.
The sale, which is subject to government regulatory approvals and other customary closing conditions, is targeted to close in the first half of 2014.
“The truck business has been an important part of our company for more than three decades and continues to produce world-lass products with dedicated and talented employees,” said Ron DeFeo, Terex chairman and chief executive officer. “However, trucks no longer fit within our changing portfolio of lifting and material handling businesses."
The acquisition includes five models of rigid haulers, with payloads ranging from 32 to 91 tons. The introduction of rigid haulers will extend Volvo CE’s position in light mining, an industry area that is complementary to the general construction, oil and gas, aggregates and quarrying and road building that Volvo CE is already active in, the company said.
The deal also sees a further three models of articulated hauler added to the Volvo portfolio, with payloads ranging from 25 to 38 tons.
“This is a strategic acquisition that offers Volvo CE considerable scope for growth,” said Volvo CE President Pat Olney. “The addition of a well-respected range of rigid haulers extends the earthmoving options for customers involved in light mining applications at a time of renewed confidence in the sector. The addition of TEL’s articulated hauler range will enhance our position in this segment, particularly in high-growth markets. We believe that the Motherwell facility and its global team members, as well as the current distribution partners, are valuable to the success of the business in the future.”