Konecranes (HEL: KCR1V), a Finnish port handling and lifting company, engaged FTI Consulting to advise the company on its merger of equals with U.S.-based Terex (NYSE: TEX). During the process, Zoomlion, a Chinese construction equipment manufacturer, offered a rival all-cash bid valued at a 100 percent premium to Terex’s share price.
Our Role With Konecranes
FTI Consulting, working closely with Konecranes and its legal advisors, conducted a financial media, public affairs and government relations campaign to highlight the regulatory hurdles of a proposed acquisition of a U.S. infrastructure company by a Chinese state-controlled entity. FTI Consulting engaged directly with U.S. lawmakers to highlight national security concerns surrounding a possible Zoomlion acquisition of Terex. FTI Consulting also worked independently and with journalists, columnists and media outlets to increase visibility of national security concerns surrounding Zoomlion’s bid. To support the campaign, FTI Consulting leveraged key opinion leaders around defense and security issues, including retired flag officers from the U.S. military, the former Director of the DoD CFIUS Program, and a Commissioner of the U.S.-China Economic and Security Review Commission. FTI Consulting also conducted and then leveraged public opinion polling on inbound Chinese investment in key 2016 election battleground states.
FTI Consulting’s efforts resulted in a bi-partisan coalition of U.S. Senators and Congressmen calling for strict CFIUS scrutiny of Zoomlion’s bid and resulted in favorable coverage for Konecranes in mainstream, political, and industry press. The intense public, political and regulatory scrutiny of Zoomlion resulted a complete abandonment of its pursuit of Zoomlion’s proposal to acquire Terex and a successful acquisition of Terex’s Materials Handling and Port Solutions (MHPS) business by Konecranes. Given the U.S. Treasury Department’s newly announced inversion regulations and the resulting loss of tax synergies expected from a full Terex-Konecranes merger, the acquisition was viewed as a welcome alternative. Following an additional announcement day media campaign, the new transaction was met with universal praise from both the press and sell-side analysts, resulting in an 18 percent increase in Konecranes’ stock price, the largest single-day increase for the company since 2008.