Terex Corporation has sold its trucks business to Volvo Construction Equipment for USD $160 million.
The business manufactured and sold off highway rigid and articulated haul trucks.
It is also selling off the manufacturing facility in Motherwell, Scotland, as part of the deal which is targeted to close in the first half of next year.
The deal will see Volvo acquire five models of rigid haulers, with payloads ranging from 32 to 91 short tons.
It also adds another three models of articulated haulers to Volvo CE’s portfolio.
“The truck business has been an important part of our Company for more than three decades and continues to produce world class products with dedicated and talented employees,” RonDeFeo, Terex’s chairman, stated.
“However, trucks no longer fit within our changing portfolio of lifting and material handling businesses. I am confident that the truck business will benefit by joining a company sharing similar competencies and offering complementary products and services. We are pleased to have entered into this agreement with Volvo, which represents a strong strategic buyer for the business who values our distribution network and team members.”
He went on to state that the “sale of the truck business reflects our strategy to manage our portfolio of businesses and focus on those businesses that provide the greatest returns for our shareholders”.
“We recently announced the initiation of quarterly cash dividends to our shareholders and a share repurchase program and the proceeds from this sale aid our efforts to improve our financial efficiency and implement these programs.”
Volvo Construction Equipment’s presidentPat Olney added that “this is a strategic acquisition that offers Volvo CE considerable scope for growth in light mining applications”.
“The addition of a range of rigid haulers extends the earthmoving options for customers involved in light mining applications at a time of renewed confidence in the sector.
“The addition of TEL’s articulated hauler range will enhance our position in this segment, particularly in high-growth markets. We believe that the Motherwell facility and its global team members, as well as the current distribution partners, are valuable to the success of the business in the future.”
As part of Volvo’s acquisition, it has also gained a 25.2% holding in Inner Mongolia North Hauler Joint Stock, which builds and sells rigid haulers under the Terex brand in China.