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Pa.'s Grove Worldwide is for sale

July 02, 1997

By LISA GRAYBEAL

Staff Writer, Chambersburg

SHADY GROVE, Pa. - British-based Hanson PLC, parent company of Grove Worldwide, is offering to sell the hydraulic crane and aerial work platform manufacturer for a reported $665 million.

Hanson PLC spokeswoman Patty DeFelice said Tuesday the company has hired the U.S. investment bank Goldman Sachs as the company's adviser in the sale of Grove.

"It's a good point in time to sell the company," DeFelice said. "I think what Hanson is trying to do is get into building materials. Grove fits more into the construction business."

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Hanson PLC does not have to sell, and the company will keep Grove if it isn't offered the right price, DeFelice said.

"We're not looking to fire-sale it," she said.

DeFelice would not confirm the sale price of $665 million, which appeared in a story in the London Sunday Times about the possible sale of Grove.

After the story appeared, Hanson PLC released a statement, confirmed by Grove officials on Tuesday, that they are receptive to offers from interested buyers and have received "a number of external inquiries."

DeFelice would not identify the interested buyers.

No deal has been signed and there is no projection of how long it will take to sell the company, DeFelice said.

"The fact that we've received inquiries from interested buyers is an indication that the market is good and that it's a good time in the cycle to sell the business," she said.

A spokesman for Goldman Sachs in New York said he could not comment on the sale because it's an "ongoing deal." He said the bank's London office is handling the transaction.

What will happen, if anything, to Grove if it's sold remains unclear.

"It's no big deal at this point. It's business as usual here. Our markets remain strong and our business remains strong," said William Foley, vice president of market support at Grove.

Unnamed experts are quoted in the London newspaper as saying that the crane division is in an extremely competitive business and profits are low.

Franklin County Area Development Corp. President L. Michael Ross said the news comes as little surprise since there's been speculation over the last several years that Hanson has been looking to "spin off" the Grove division.

"We're trying to prevent ourselves from speculating," Ross said. "There's no certainty that anything will happen."

The 50-year-old company, which doesn't release employment figures, is believed to employ between 2,500 and 3,000 people in Franklin County at its headquarters plant in Shady Grove, Pa., and at its product support division in Chambersburg, Pa.

"Grove is the primary driving engine in our local economy," Ross said.

For that reason, the development corporation wants to be involved in discussions with the current and new owners to ensure its presence in the county, he said.

Even if the company is sold, Ross said he anticipates the new owners would want to stay in Franklin County because of the well-trained, productive work force and the existing facilities.

The company employs more than 4,000 people at its Franklin County divisions and at plants in England, France, Germany, Singapore and China, among others, Foley said.

Hanson PLC acquired Grove in 1987 as part of a $1.6 billion merger with New Jersey-based Kidde Inc.

Kidde put Grove on the selling block in 1983, reportedly asking $250 million, but did not find a buyer for the then-struggling company.

Over the last 18 months, Hanson sold its chemical, energy and tobacco divisions, DeFelice said.

The company's interests are now in aggregates, companies like Cornerstone, the United State's third largest producer of sand and gravel, crushed stone, and other building materials. It also owns ARC, England's largest aggregate company, and Hanson Brick, England's largest brick producer.

Grove announced on June 12 that it had landed a government contract for up to 450 all-terrain, mobile cranes for the Department of Defense.

The contract was expected to mean $120 million for Grove, a company spokesman said at the time.

In April, Grove officials announced that 120 additional production workers would be hired to meet growing product demand, including the government contract they knew was coming.

Grove is the country's largest supplier of cranes for the military, according to a company official.

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