Demag Urges Shareholders to Reject Terex Buyout Offer

Duesseldorf, Germany (May 31, 2011) The Management Board and Supervisory Board of Demag Cranes AG published a statement giving reasons for their view that the voluntary public tender offer by Terex Industrial Holding AG on May 19, 2011, with an offer price of EUR 41.75 is not in the interest of Demag. They recommend  of Demag Cranes shareholders not accept the Terex offer.

The boards based their recommendation notably on the following considerations:

  • The offered price of EUR 41.75 is considered inadequate from a financial point of view. Deutsche Bank AG and Rothschild GmbH have confirmed this assessment to the Management Board and Lazard & Co. GmbH has independently confirmed the assessment to the Supervisory Board in their respective fairness opinions.
  • The boards expect to regain strong rates of revenue growth in the next two financial years. The company anticipates generating Group revenue in the ongoing financial year of approx. EUR 1.06 billion (previous target: EUR 1.02 billion to EUR 1.05 billion). For the financial year 2010/2011, the Company anticipates an operating EBIT margin of approx. 6.4% (previous target: 6.1 to 6.5%; financial year 2009/2010: 5.8%). No later than financial year 2012/2013, Group revenue is forecast to grow to EUR 1.3 billion and therefore to exceed the record level reached in financial year 2007/2008 (EUR 1,225.8 million). Subject to meeting the revenue target, the boards expect Group operating EBIT margin to be above 10% by as early as financial year 2012/2013.

In their statement, the boards refer expressly to the fact that Terex published its offer to the shareholders without solicitation and that no agreements or arrangements with Demag Cranes in advance. It is currently not possible to assess the strategic aims of the offer or any other intentions of the bidder – including with regard to locations and jobs.

The reasoned opinion can be viewed on the company's website in German at http://www.demagcranes-ag.de/de/Investor_Relations/Uebernahmeangebot/index.jsp and an English translation can be found at http://wcms.demagcranes.info/dcag_edit/en/Investor_Relations/Tender_Offer/index.jsp. The German version is authoritative.

About Demag Cranes
The Demag Cranes Group is one of the world's leading suppliers of industrial cranes and crane components, harbour cranes and terminal automation technology. Services, in particular maintenance and refurbishment, are another key element of the Group's business activities. The Group is divided into the business segments Industrial Cranes, Port Technology and Services and has strong and well-established Demag and Gottwald brands. Demag Cranes sees its core competence in the development and construction of technically sophisticated cranes and hoists as well as automated transport and logistics systems in ports and terminals, the provision of services for these products and the manufacture of high-quality components.

As a global supplier, Demag Cranes manufactures in 16 countries on five continents and operates a worldwide sales and service network that is present in over 60 countries through its subsidiaries such as Demag Cranes & Components GmbH and Gottwald Port Technology GmbH, agencies and a joint venture. In financial year 2009/2010, the Group, with its 5,711 employees, generated revenue of EUR 931.3 million. Since the end of June 2006, the Demag Cranes share (WKN: DCAG01) has been listed in the Prime Standard of the Frankfurt Stock Exchange and is traded on various indices including the MDAX®.

 

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