Konecranes completes MHE Demag deal
Port and overhead manufacturer Konecranes has acquired the remaining 50 percent of its overhead/industrial crane joint venture, MHE-Demag, for approximately €147 million.
Established as a joint venture between Demag Cranes and Jebsen & Jessen in 1986, Singapore based MHE-Demag provides industrial cranes, hoists and services throughout Southeast Asia under the MHE and Demag brands. The company also provides warehousing equipment such as lift trucks and dock levelers, aerial work platforms, building maintenance units and compact construction equipment.
MHE-Demag generated revenues of €179 million in 2018, with its service division making up 50 percent, its cranes and components division accounting for 35 percent and its industrial products making up the final 15 percent. Prior to the sale Konecranes was the main supplier to MHE-Demag, selling Demag overhead crane components.
Teo Ottola, interim chief executive financial officer of Konecranes, said: “With the MHPS acquisition now behind us, Konecranes is ready to take the next steps on its growth path. This acquisition underlines our intent to pursue profitable growth, and meaningfully expands our footprint in a strategically important region with several fast-growing markets. The acquisition will also bring greater balance to Konecranes’ regional sales structure.”
The company claims the acquisition will provide between €150 and 180 million in sales by 2022 and will increase sales in Asia Pacific by up to 30 percent, while creating further opportunities for service business.
MHE-Demag employs more than 18,000 - including 700 service engineers – at its 11 facilities and 70 service locations throughout Australia, Indonesia, Malaysia, Singapore, the Philippines, Taiwan, Thailand and Vietnam. It also operates through distributors in Brunei, Cambodia, Laos, Mongolia, Myanmar, Papua New Guinea and Timor-Leste. To date, the company has manufactured more than 26,000 industrial cranes and more than 2,000 building maintenance systems.