Terex makes offer for Demag Cranes

By Euan Youdale19 May 2011

Terex Industrial Holding AG, a subsidiary of Terex Corporation, today (19 May) launched a voluntary public tender offer for all outstanding shares of Demag Cranes AG (Demag).

As previously announced, Terex is offering Demag shareholders a price of €41.75 in cash which represents a premium of 41% to the pre-takeover speculation share price on 6 October, 2010, said Terex. The offer also represents a premium of 19% compared to the volume weighted three months average share price prior to the publication of the decision to launch an offer on 2 May, 2011 and a premium of 15% to the closing price on 29 April, 2011 of €36.30, added Terex.

Demag's business is highly complementary to that of Terex, and the combination has a compelling industrial logic, said the company. 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.

"We see Demag as an excellent fit with our existing business and believe that we can build upon business opportunities much more effectively and accelerate growth for both companies," said Ron DeFeo, Terex chairman and chief executive officer. "We have a lot of respect for the Demag management team and its work force and would welcome the opportunity to discuss the compelling industrial logic of a combination of our businesses."

The offer period starts today and is set to end on 30 June, 2011. Acceptance must be declared in writing to the respective custodian bank and further details on how to accept the offer are provided in the offer document. Commerzbank AG will act as settlement agent with regards to the offer. The tender offer is subject to the condition of a minimum acceptance level of not less than 51% of all Demag shares outstanding, Terex explained.

Following its approval by the German Federal Financial Supervisory Authority (BaFin) the offer document is now available at www.industrialholding-angebot.de.

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