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| Volvo acquires Ingersoll Rand's road construction-equipment unit  Volvo has reached an agreement with Ingersoll Rand to acquire the assets of the company's road development division, a world-leading manufacturer of heavy equipment for road construction and soil compaction with revenues of USD 864 M in 2006. Operations also include material handling equipment. The purchase price amounts to USD 1.3 billion in cash, or SEK 9.2 billion. The acquired business includes a full range of heavy compactors, asphalt pavers and milling machines and provides favorable growth possibilities.The acquisition includes 20 dealerships in North America and distribution companies in Europe and Russia which will leverage Volvo CE's sales of compact equipment, primarily in North America. Synergies at operating income level, mainly attributed to sales and distribution, are estimated at SEK 600 M annually to be achieved within a five-year period. The acquisition is primarily being carried out as an assets purchase and the transaction is expected to reduce the net financial position for Volvo by SEK 9.2 billion. Closing of the transaction is expected during the second quarter 2007 and is subject to relevant approvals. Ingersoll Rand's division for road development, with headquarters in Shippensburg, Pennsylvania in the US, has about 2,100 employees. In 2006 the operations reported sales of USD 864 M and operating income of USD 101 M. The operations have manufacturing units in the US, Germany, India and China. write your comments about the article :: © 2007 Construction News :: home page |