Zoomlion Heavy Industry Science and Technology Co (中聯重科) of China has said that it would drop its pursuit of US crane and heavy equipment maker Terex Corp.
Terex and Konecranes Oyj of Finland announced in August last year that they would merge in an all-stock deal, but Zoomlion swooped in with a competing bid in January to acquire Terex for US$30 per share in cash, or about US$3.3 billion. Zoomlion raised its bid to US$31 per share in March.
This month, Terex terminated its merger agreement with Konecranes and said it would instead sell its material handling and port solutions business to the Finnish company for about US$1.3 billion.
Terex said at the time that the port deal would allow it to continue discussions with Zoomlion and would eliminate perceived regulatory concerns about a transaction with the Chinese company. Analysts had suggested that the US authorities might raise objections over the ports business.
On Friday the 27th of March, Zoomlion said that no agreement could be reached “on the crucial terms,” and that it had ended negotiations with Terex.
“The company will continue to seek strategic opportunities for its long-term development, and further procure its strategic transformation and industrial upgrading,” Zoomlion said in a regulatory filing in Hong Kong.
Terex, based in Westport, Connecticut, manufactures cranes and other heavy equipment for a number of industries, including construction, manufacturing, shipping, energy and mining. It posted revenue of US$6.5 billion last year and has about 20,400 employees.
The company said its board had “worked diligently” to determine whether a transaction with Zoomlion was achievable.
“After many months of discussions, Zoomlion was unable to provide a fully-financed, binding proposal for the purchase of Terex” with or without the material handling and port services business, Terex chairman David Sachs said. “The board is confident in our global management team and with Terex’s prospects for the future.”
Terex said that it would proceed with its plans to sell the material handling and port services business to Konecranes, a deal that is expected to close in January next year.
China’s Zoomlion drops quest for US crane maker