Terex has received an unsolicited acquisition proposal from Zoomlion for all of its outstanding shares at a price of $30 a share, causing the value of Terex stock to jump up by 37% from roughly $15 a share to $20.5 a share.
According to a Terex proposal from Zoomlion would be conditioned on, among other things, receipt of US and Chinese regulatory approval and Zoomlion shareholder approval.
Terex Corporation appears to be seriously considering the offer, having entered into confidential “discussions with Zoomlion regarding the proposal.”
A statement read: “Consistent with its duties, the Terex board of directors is carefully reviewing the Zoomlion proposal to determine the course of action in the best interests of Terex shareholders.”
At this point, there is no immediate suggestion that Terex board of directors has in any way changed its recommendation of the proposed merger with Konecranes announced in August 2015.
The Terex and Konecranes agreement is an all stock merger that will create a crane and material-handling suppler with a combined $10bn in sales, and with a combined value of $2.5bn.
However, the $30 a share offer from Zoomlion, China’s second largest maker of construction equipment by revenue after Sany, would value Terex at $3.3bn.
Bloomberg Business commented: “Terex rebuffed an initial proposal from Zoomlion and is focused on completing the merger with Konecranes. One concern about the Chinese offer is that a Zoomlion takeover could face US opposition because of the strategic importance of crane operations on ports.”
The share prices of Konecranes, Manitowoc and Joy Global also increased following the news.
