The deal, says Konecranes, creates "a focused global leader in industrial lifting and port solutions," with aggregated sales (2015) of around €3.5B, adjusted EBITDA of €267M and a global workforce of around 19,000.

Synergies of €140M /year targeted at EBIT level are to be implemented within three years. Highlights of the deal include:

• Terex Corporation becomes a 25% shareholder in Konecranes after receiving 19.6M class B shares
• David Sachs and Oren Shaffer join the Board of Directors, as announced in connection with the EGM held on 15th September, 2016, with respective appointments to the Nomination and Compensation Committee and the Audit Committee.

Konecranes says that the acquisition of MHPS will improve its position as a focused global leader in the industrial lifting and port solutions market. Christoph Vitzthum, Chairman of the Board of Konecranes, said: “The MHPS acquisition is a milestone in building our future. It is a great achievement to bring Konecranes and MHPS together and we expect it to create substantial value for our customers and shareholders."

In terms of products and branding, Konecranes has released a list of its product offering for ports as of 5 January. This features a strong emphasis on both the Gottwald and Noell legacy names, with "Konecranes Gottwald" featuring for AGVs and mobile harbour cranes, both new additions to Konecranes' portfolio. 

Two main consolidations are evident at this stage: "Konecranes Noell" becomes the product label for straddle carriers, while "Konecranes" is the product label for ASCs, reflecting the fact that Konecranes ASC design will be the primary offering in this market. 

Both "Konecranes" and "Konecranes Noell" will be used for different STS, RTGs, and RMGs cranes, while in Liftrucks Konecranes will retain the "Konecranes" and "Konecranes Liftace" (former Terex) product lines. At this stage, therefore, Konecranes has opted to keep all existing designs in these sectors availabe in the market.

The three TPS software businesses (TBA in the Netherlands, Central Systems and Automation and DBIS in the UK) are not mentioned in the product offering. It is understood Konecranes wants to keep these companies, whose customers expect them to provide equipment agnostic software and services, independent. 

Panu Routila, President and CEO of Konecranes, commented: “We are extremely proud to combine forces with MHPS. We want to provide a home for Demag and Terex Port Solutions, from which these businesses can grow and become stronger as part of our joint organisation. The MHPS acquisition makes it possible for us to realize a long list of synergies. We will be one technology company, ready to create the next generation of lifting.”

Konecranes says that it is well-prepared to deliver expected synergies based on the extensive integration planning work carried out jointly with Terex over recent months.

Of the total of €140M/year synergies targeted within three years, €35M is expected to be implemented within 12 months from 1st January, 2017, from which date the MHPS acquisition is deemed effective from a financial point of view. Overall, synergies will come from procurement, operations and SG&A.

One-off implementation expenses are expected to be €130M, with €60M of capex expected. In addition, synergies related to new opportunities in global service operations are expected to lead to significant earnings growth.

The consideration for the MHPS business is US$595M and €200M in cash, plus 19.6M new class B shares @ €35.01 per share (€686.196M)- the closing price of Konecranes' class A shares on the Nasdaq Helsinki today, 4th January. The total deal is thus worth approximately US$1.525B to Terex Corp. As previously notified, the new class B shares have been issued to Terex Deutschland GmbH.

Pursuant to the Stock and Asset Purchase Agreement dated 16th May 16, 2016, the final cash consideration is subject to post-closing adjustments for cash, debt, working capital and the closing of the sale of the Stahl CraneSystems business.

As of 1st January, 2017, Konecranes is reporting three business areas: Service, Industrial Equipment and Port Solutions. The Executive Board is made up of:

• Panu Routila, President and CEO
• Teo Ottola, CFO and Deputy CEO
• Fabio Fiorino, EVP, Business Area Service
• Mikko Uhari, EVP, Business Area Industrial Equipment
• Mika Mahlberg, EVP, Business Area Port Solutions
• Juha Pankakoski, EVP, Technologies
• Susanna Schneeberger, EVP, Strategy
• Timo Leskinen, SVP, Human Resources
• Sirpa Poitsalo, SVP, General Counsel.

The full Board of Konecranes is made up of: Christoph Vitzthum, Chairman; Stig Gustavson, Vice Chairman; Svante Adde; Ole Johansson; Ms Janina Kugel; Bertel Langenskiöld; Ulf Liljedahl; Ms Malin Persson; David Sachs; and Oren Shaffer