Terex Tenders Offer to Buy Demag Cranes

Terex Tenders Offer to Buy Demag Cranes

WESTPORT, Conn. (May 02, 2011) -- Terex Corp.'s (NYSE: TEX) German subsidiary, Terex Industrial Holding AG, decided to make a voluntary cash public tender offer for the outstanding shares of Demag Cranes AG (XTRA: D9C) at EUR 41.75 ($61.94) per share. The proposed offer price represents a premium of approximately 41% to the last undisturbed share price, prior to the speculation regarding possible takeover interest in Demag, on October 6, 2010 of EUR 29.65 ($43.99), and a premium of 15% to the closing price on April 29, 2011 of EUR 36.30 ($53.86).

Terex is a global manufacturer operating in four business segments, Aerial Work Platforms, Construction, Cranes, and Materials Processing, with net sales of $4.4 billion in 2010 and 16,300 employees worldwide. Demag, headquartered in Dusseldorf, Germany, is a leading provider of industrial cranes, crane components, harbor cranes and port automation technology.

The combined entity would have had total revenues of about $5.8 billion in 2010 with a strong footprint in Europe and emerging markets, especially in China.

"By combining our businesses, we would add a new product category of industrial cranes and hoists, and create the leading worldwide player in port equipment," said Ronald M. DeFeo, Terex chairman and CEO. "Demag products are competitive and innovative. The company is professionally managed, with highly motivated staff, and Terex will draw on this for both Demag's ongoing success -- and the future of Terex as a whole. Terex intends to build on the strong brand and service franchise of Demag in Germany and abroad. This transaction is predicated upon growth and not cost reduction."

In ten years Terex has acquired four significant German businesses, one of them Demag's former sister company, Demag Mobile Cranes in 2002, whose turnover has more than doubled since. Today, Germany is Terex's second-largest market and production base. About 22% of Terex's global employees are located in Germany.

Terex will be financing the total offer consideration of EUR 884 million ($1.3 billion) from its existing cash and an already committed debt financing. The tender offer will carry a minimum acceptance level condition of not less than 51% of all Demag shares outstanding.

The tender offer will be launched by Terex Industrial Holding AG, an indirect wholly-owned subsidiary of Terex, and will be subject to the terms and conditions to be set out in the offer document. The offer document is subject to approval by the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin), and following such approval will be made available on www.industrialholding-angebot.de.

Companies in this article