According to an exclusive Reuters report, Terex has asked Zoomlion to increase its initial $3.3 billion offer if the Chinese company wants Terex to walk away from its merger agreement with Finland’s Konecranes.
The Reuters report said that Terex has argued privately that the synergies with Konecranes in the material handling and ports systems businesses of the two companies are of greater long-term value than the $30 per share cash offer Zoomlion offered, the sources said this week. While Terex has not said exactly what its price would be to justify breaking up the Konecranes merger, Zoomlion has not publicly shown willingness to increase its offer.
This latest development may illustrate Zoomlion's main stumbling block in its negotiations with Terex is price, rather than concerns that the United States could block the deal because of Terex's ties to the U.S. military and presence in U.S. ports. There seems to be little progress by Zoomlion since its unsolicited offer to Terex was announced February 17.
As of February 22, Konecranes Oyj still expected a planned merger with Terex to go ahead though it may take longer than hoped to close, the Finnish firm's chairman said.
"The operative development work between Konecranes and Terex has come to a point where we can't go forward before we have approvals from competition authorities," Konecranes chairman Stig Gustavson told Reuters on Monday. "But everything else is going forward as it should be," he said, adding the deal had so far won approvals from two jurisdictions out of the required 10."
Gustavson said that, in the best case, he now expected the deal to close in "late June, or July-August."
Terex said on Friday, February 19, it had not changed its recommendation in favor of merging with Konecranes.