Demag

In January, Demag signed a letter of intent for a majority interest in Weihua Group Co., Ltd, one of the largest makers of industrial and harbor cranes in China.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

But at €41.75 $59.45 per share, the cash offer is 9.4% below Demag's Thursday closing price of €46.10, and analysts said the U.S. company would likely have to raise the bid to entice Demag shareholders.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

Terex, based in Westport, Conn., said its offer represented a premium of 41% to Demag's share price in early October, when takeover rumors first began circulating in the market.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

Terex said acquiring Demag would create a combined company with annual revenues of roughly $5.8 billion with large market shares in Germany, China and other emerging markets.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

U.S. construction-equipment maker Terex Corp. formally launched a $1.3 billion unsolicited offer for German rival Demag Cranes AG, the latest deal to test Germany's tolerance for hostile bids by foreign companies.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

But analysts voiced skepticism that Terex, which currently holds about 1% of Demag shares, could avoid raising its offer price.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

Some investors and analysts have speculated Finnish-based crane maker Konecranes Oyj, which approached Demag with a merger proposal and was rebuffed last year, might make a counteroffer, though antitrust concerns remain a prohibiting factor.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

U.S. construction-equipment maker Terex formally launched a $1.3 billion unsolicited offer for German rival Demag Cranes, the latest deal to test Germany's tolerance for hostile bids by foreign companies.

What's News 2011

The company has stood by its price, saying Demag managers made it difficult to more fully assess Demag's value.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011

Terex signaled the bid earlier this month after months of stalled attempts at talks with Demag management.

Terex Launches Hostile Bid for Demag Cranes Mary M. Lane 2011