Terex has sued Bucyrus International, accusing it of abusing post-closing adjustments to cut the $1.3 billion acquisition price of Terex’ mining business, Bloomberg has reported. Terex sold the unit to South Milwaukee-based Bucyrus in February for $1 million in cash and 5.8 million shares of stock.
The companies agreed to allow for post-closing adjustments to recognize any changes in the net capital of the mining business during the two months between the signing and closing of the contract, according to Terex’ lawsuit filed Oct. 29 in New York state court in Manhattan.
Bucyrus, a manufacturer of surface mining machinery, abused the adjustments “to launch an unsubstantiated wholesale challenge” to pre-closing accounting and to argue for a $150 million reduction in the net asset value of the unit, according to the lawsuit.
Terex added in its complaint that nothing in the asset purchase agreement allows Bucyrus to audit the base net asset value of the Terex business so it can re-adjust the purchase price. Terex, claiming that Bucyrus is breaching the contract, is asking for a court order for Bucyrus to turn over books and records to Terex, to honor its contract and pay unspecified damages.
Bucyrus officials were not immediately available for comment.
