Konecranes Drops Merger with Terex, Aims to Buy MHPS

Terex MHPS After they postponed their merger in February 2016, the Finnish manufacturer of cranes Konecranes Plc and US-based lifting and material handling company Terex Corporation now terminated the previous plan and sealed a deal for the sale of Terexs Material Handling & Port Solutions (MHPS) segment. Under the new agreement, valued at EUR 1.13 billion (USD 1.28 billion), Konecranes would acquire MHPS in order to improve its position in the Industrial Lifting & Port Solutions market, according to the company. The deal, which is expected to close in early of 2017, will see Terex receive USD 820 million in cash and 19.6 million newly issued Konecranes class B shares, making the company a 25% shareholder. Konecranes said that the deal may be terminated by Terex prior to May 31, 2016, if it enters into a merger agreement with Chinese Zoomlion Heavy Industries Science & Technology, in which case, it will compensate Konecranes with a termination fee of USD 37 million. If the Konecranes shareholder approval is not obtained, Konecranes will be required to compensate Terexs transaction expenses in the amount of up to USD 20 million. This acquisition will prove crucial to improving our position as a global partner in services, industrial lifting and port solutions, and at the same time create significant value for our owners, Panu Routila, President and CEO of Konecranes, said. The two companies announced their merger plans in August, 2015 after their Boards of Directors unanimously approved the merger which would have formed a company called Konecranes Terex Plc. However, Terex and Konecranes decided to postpone their merger in February 2016, without revealing the reasons which prompted the decision. At the time, the companies said that they would “continue to move forward with all necessary filings to achieve antitrust, regulatory and shareholder approvals that are required to complete the merger transaction”.