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Firm must sell division before buying Grove

August 03, 2002|by RICHARD BELISLE

waynesboro@herald-mail.com

Before Manitowoc Co. Inc. can buy Grove Worldwide, the U.S. Justice Department is insisting that one of the two companies sell its boom truck division to a competitor to avoid a monopoly, Manitowoc officials said this week.

Both companies have major boom truck divisions.

The companies agreed to sell Manitowoc's boom truck division in Georgetown, Tex.

Officials of both firms announced in March that Manitowoc would buy the financially troubled Grove for $270 million, some $335 million less than Keystone Inc., a Fort Worth, Tex., investment company, paid for Grove in 1997.

Employment at the local plant dropped from about 2,500 workers at the time of the 1997 sale to about 1,000 today.

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Grove filed for bankruptcy in 2001 and cut its debt from $584 million to $205 thanks to a bailout by a banking group and bond holders. The company has since recovered.

Terry D. Growcock, president and chief executive officer of Manitowoc, said in a press release: "After considerable effort by both Manitowoc and Grove to negotiate another outcome, we saw no other way to meet regulatory requirements without entering into costly litigation that would not serve the best interests of our shareholders, customers and employees. We believe the resulting Grove acquisition will benefit our company and the crane industry long term."

Glen E. Tellock, president of Manitowoc Crane Group, said in the same release, "On a positive note for the employees, distributors and customers of Manitowoc Boom Trucks, the Department of Justice also stipulated that the sale be made to a buyer who will keep the business as a viable competitor after the sale. Manitowoc will continue to design, build and sell its boom trucks until that sale is complete, Tellock said.

Grove Worldwide is a wholly owned subsidiary of Grove Investors, Inc. and is a leading manufacturer of hydraulic and truck-mounted cranes and aerial work platforms for the global market under the brand names, Grove Crane, Grove Manlift and National Crane.

Manitowoc makes lattice-boom and tower cranes, boom trucks and is also a leading manufacturer of refrigeration equipment for the food service industry. It is also a major player in ship repair, conversion and new construction for the Great Lakes maritime industry.

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