12.09.2024

Tadano to Acquire Manitex

Tadano is to acquire Manitex International in an all cash deal for $223 million including around £85 million net debt. Tadano already owns a 14.5 percent stake in the business, which it purchased in 2018. The purchase price represents a premium of 52.2 percent over Manitex’s share price of $3.81 on September 11th. Tadano will fund the transaction from its cash reserves and external debt financing.

Manitex International includes Manitex boom trucks/truck cranes, PM loader cranes, Oil & Steel aerial work platforms and Valla pick & carry cranes. Manitex International annual revenues are around $300 million.

Manitex chairman David Langevin said: “We are pleased to have reached this agreement with Tadano, which we believe will deliver immediate and certain cash value to Manitex shareholders at a significant premium to the most recent share price, the board’s decision follows careful evaluation of the transaction and a comprehensive strategic review process that began in late 2023.”

Chief executive Michael Coffey added: “Our expanded partnership with Tadano represents a new and exciting chapter for our employees and our customers. The acquisition by Tadano will help mitigate cyclical risk, while providing the company with scale and broader international scope. We will benefit from access to technology, production synergies and working capital, enabling the company to better achieve its objectives. Together with Tadano, we are strategically positioned to build a leading provider of lifting equipment solutions to the construction, infrastructure, and industrial markets.”

Tadano Chief executive Toshiaki Ujiie said: “For us as a company, the acquisition of Manitex will help us to further diversify our product portfolio while remaining 100 percent committed to the lifting equipment industry. It will lead the future growth that will help us to expand our global truck loader crane and aerial work platforms.”

“For our customers this acquisition means that we will offer them a broader product portfolio to even better serve their lifting needs. With the combined strength we can support our customers in new areas, further innovate and ultimately bring more solutions for our customers and the industry.”

The transaction is expected to close early in the first quarter of next year, and is subject to approval by Manitex shareholders.

See: Tadano acquired a 14.5 percent stake in 2018 since when it has had a seat on the Manitex board.

Tadano is expected to make a formal announcement to the Tokyo Stock Exchange tomorrow.

Vertikal Comment

While you might think that jumping into another sizeable acquisition while still battling with the last one is foolhardy, this one makes much more sense for Tadano in that it brings no product duplication or overlap, while adding to market sectors that Tadano is looking to expand and exploit more - loader cranes and aerial work platforms. In fact, Manitex is an excellent fit.

Tadano is a leading player in the Japanese aerial lift market, especially when it comes to truck mounted models and a significant player in the Japanese telescopic loader crane market. However, it sells very few aerial lifts outside of Japan, and very few loader cranes outside of South Asia and the Pacific region.

Manitex gives it a strong position in the American boom truck market, as well as small lighter duty truck cranes, dovetailing nicely with its own larger truck crane models. The pick & carry market with Valla is a completely new one for Tadano and opens up some interesting potential in markets that Valla could never reach. PM cranes is also appealing in that it provides Tadano with a good line up of articulated loader cranes, something that it has never had and a market that is technically challenging to enter. It also brings technology that could be useful in other parts of the group.

Finally, Oil & Steel offers truck mounted lifts - particularly in the 3.5 tonne market - as well as spider lifts. Add this to Tadano’s line up which it is hoping to sell globally, and Nagano which the company acquired at the end of last year and it begins to look like a more serious player in the global aerial lift market, although it still has a long way to go.
The key to making all of this work however is how the acquired businesses are managed. In recent years the company has not been a shining example when it comes to integrating and exploiting acquisitions - Nagano included.

So in summary, this will bring plenty of opportunity but only if it is managed well. That is a big if.