Terex Corp. has agreed to sell 51 percent of A.S.V. Inc. to Manitex International, which will result in a joint venture in compact track loaders and skid-steer loaders that is 51-percent owned by Manitex and 49 percent owned by Terex. The transaction is expected to result in $125 million in cash received by Terex prior to closing as well as tax benefits.
Upon completion of the transaction, ASV will continue to sell its compact track loaders and skid steers under the Terex brand. The transaction is expected to be completed before the end of 2014.
"The formation of this joint venture is a positive for both Terex and ASV,” said Terex chairman and CEO Ron DeFeo. “Terex preserves its broad compact equipment product offering and its participation in an expected housing recovery. Manitex will augment ASV’s existing distribution channels, allowing for faster growth of the ASV business.”
Included in the transaction is ASV’s Grand Rapids, Minn., manufacturing facility and certain assets held at Terex’s Southaven, Miss., distribution center.
In a separate transaction, Terex will use a portion of the cash it receives as a result of the ASV sale to acquire $12.5 million of newly issued Manitex common shares and $7.5 million of convertible debt securities. “We have sold businesses to Manitex and profitably owned their equity in the past,” DeFeo added. “They are a good aggregator and operator of machinery businesses, and we look forward to extending our value-creating relationship.”