18.12.2009

Technical default at Gehl

An Extraordinary General Meeting of Manitou shareholders yesterday was told that its Gehl subsidiary was in technical default with its banking syndicate. The meeting also approved the appointment of two new directors.

The Meeting approved resolutions regarding the adoption by the company of the board of directors structure put forward this summer and appointed Pierre-Henri Ricaud and Christopher Himsworth as directors, taking the board up to nine members.

Chief executive Jean-Christophe Giroux told the meeting: “Visibility into our markets is still very poor, but the fourth quarter shows stabilising revenues, after five consecutive quarters of decline. We also believe that our efforts on costs and working capital (especially inventories) will result in a more acceptable
operating loss and a rapid reduction in net debt.”

“However, continuing sluggish economic conditions in the USA have resulted in a still depressed business for Gehl, which faces a technical default with its banking syndicate. Negotiations are already taking place with a view to finding a long-term solution. Gehl’s underperformance will result in certain extraordinary items that will weigh on Manitou’s consolidated net income, but will not impact the company’s French credit agreement.”

A supervisory board meeting held after the EGM, appointed Marcel Braud as non executive chairman and Jacqueline Himsworth as vice-chairman. At the same time it confirmed Jean-Christophe Giroux as president and chief executive officer and Christian Caleca as president - Rough-Terrain Handling division.

The Board also adopted its new set of internal rules and confirmed the members of its specialised committees.