Terex, GAZ In Joint Venture
GAZ Group, part of Oleg Deripaska's Basic Element, and Terex Corp. announced that they have entered into an agreement to form a joint venture company for the manufacture of construction and roadbuilding equipment in Russia. Under the agreement, the joint venture will manufacture, market and sell certain Terex and all GAZ Group construction and roadbuilding products in Russia, as well as distribute construction and roadbuilding products manufactured by Terex and exported into Russia.
The joint venture will also sell certain construction and roadbuilding products of GAZ Group for export. No financial details were provided. GAZ Group will provide manufacturing facilities and human resources, as well as access to the GAZ Group's Construction Equipment Division dealer network. The joint venture arrangement will allow access to relevant technology and know-how that will help to upgrade the current product portfolio of the GAZ Group Construction Equipment division. The joint venture is expected to be operational in early 2012.
"From our viewpoint, the opportunity for Terex to participate in helping to build vital infrastructure in Russia and other markets, as we better serve the equipment needs of both existing and new customers is truly exciting,” said Ronald M. DeFeo, chairman and chief executive officer, Terex Corp. “The combined product offerings, expanded geographic reach and extensive manufacturing capacity in the Russian Federation offer considerable opportunity for both our companies."
Bo Andersson, president of GAZ Group, stated that "creation of a JV with leading international manufacturer Terex will make it possible to significantly extend the model range of GAZ Group's construction and road-building equipment, to master modern technologies and cooperate on strategic procurement opportunities. It will give us good opportunities to enter new export markets as well."
The joint venture will announce the specific Terex designed products that will be initially introduced and producing in the near future as decisions are finalized. Production is planned for GAZ Group's Tvex Excavator, Bryansk Arsenal, Chelyabinsk Construction and Road Machines, and Zavolzhsky Crawler Vehicle plants.