NORWALK, Conn. - Terex Corporation (NYSE:TEX), a global manufacturer of materials processing machinery and aerial work platforms, has announced the pricing of $750 million in 6.250% senior notes due 2032. The notes, part of a private offering, are intended to finance the company's upcoming acquisition of Dover Corporation (NYSE:DOV)'s Environmental Solutions Group (ESG).
The offering, which is expected to close on October 8, 2024, is available only to qualified institutional buyers and certain non-U.S. persons in accordance with the Securities Act of 1933, as amended. These notes will not be registered under the Securities Act or any state securities laws and will be subject to restrictions on resale.
Proceeds from the senior notes, along with new term loan borrowings and available cash, will be used to finalize the acquisition and cover related fees and expenses. Terex also plans to amend its existing credit agreement to increase its revolving credit facilities from $600 million to $800 million and extend their maturity to five years post-acquisition. Additionally, Terex expects to incur term loans of up to $1.250 billion, maturing seven years after the acquisition closes.
This strategic move aims to expand Terex's portfolio in environmental solutions, aligning with its products that support renewable energy and materials recovery from waste. Terex's products are manufactured across North America, Europe, Australia, and Asia, with a global sales footprint.
The company's forward-looking statements regarding the acquisition and financing are based on current expectations and are subject to risks and uncertainties that could cause actual results to differ materially. These include the timing and completion of the private offering, the acquisition, and the amendment to the credit agreement, as well as other risks outlined in Terex's SEC filings.
This press release is not an offer to sell or a solicitation of an offer to buy the notes or related guarantees. The information provided is based on a press release statement and is intended to inform investors of Terex's financial activities related to the upcoming acquisition.
In other recent news, Terex Corporation has been actively pursuing strategic financial developments. The company announced a $750 million senior notes offering to finance the acquisition of assets from Dover Corporation's Environmental Solutions Group (ESG). Simultaneously, Terex is seeking to amend its existing credit agreement, intending to increase its revolving credit facilities from $600 million to $800 million.
Additionally, Terex's recent financial performance shows strong results with Q2 revenues totaling $1.4 billion and adjusted earnings per share at $2.16. As a result, the company has revised its 2024 earnings outlook, now expecting adjusted earnings per share to fall between $5.80 and $6.20, with projected revenues of $4.85 to $5.05 billion.
The company has also cleared a regulatory hurdle in its acquisition of ESG, expecting the deal to close later this year. To support this acquisition, Terex expanded its credit facilities involving major financial institutions such as UBS, Bank of America, Barclays, and JPMorgan Chase (NYSE:JPM). These are the recent developments concerning Terex Corporation.
InvestingPro Insights
As Terex Corporation (NYSE:TEX) gears up for its significant acquisition of Dover Corporation's Environmental Solutions Group, InvestingPro data provides valuable context to the company's financial position and market performance.
Terex's market capitalization stands at $3.53 billion, reflecting its substantial presence in the materials processing machinery and aerial work platforms industry. The company's P/E ratio of 7.14 suggests that it's trading at a relatively low earnings multiple, which aligns with an InvestingPro Tip indicating that Terex is "Trading at a low P/E ratio relative to near-term earnings growth." This valuation metric could be particularly interesting for investors considering the company's expansion plans through the ESG acquisition.
Furthermore, Terex has demonstrated financial stability and shareholder value. An InvestingPro Tip highlights that the company "Has maintained dividend payments for 12 consecutive years," with a current dividend yield of 1.29%. This consistent dividend history may provide some reassurance to investors as Terex takes on additional debt for the acquisition.
The company's revenue for the last twelve months as of Q2 2024 was $5.19 billion, with a revenue growth of 4.22% over the same period. While this growth is modest, it's worth noting that Terex's operating income margin stands at a healthy 12.03%, indicating efficient operations.
InvestingPro offers additional insights, with 11 more tips available for Terex, providing a more comprehensive analysis for investors interested in the company's prospects following this major acquisition.
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