Joy Global Inc. has entered into an agreement to acquire 100% ownership interest in LeTourneau Technologies from Rowan companies for $1.1 billion in cash. LeTourneau designs, builds, and supports equipment for the mining and oil and gas drilling industries. The transaction is expected to be completed within 60 days.
LeTourneau has two business segments, mining and drilling products. The mining products business is the world leading manufacturer of large wheel loaders for surface mining. In 2010, the mining products business provided $259 million and $67 million in revenue and EBITDA, respectively. The drilling products business is one of the leading designers of offshore jack-up drilling as well as a manufacturer of the primary components for these rigs. In 2010, the drilling products business provided $556 million and $38 million in revenue and EBITDA, respectively.
Joy Global Inc. President and Chief Executive Officer, Mike Sutherlin, foresee this acquisition as a ‘perfect fit’ for their P&H business. Letourneau is the only manufacturer of electric drive loaders and has the most extensive and largest size of wheel loaders. These wheel loaders are capable of hauling 400 ton trucks. The company will finance this acquisition through a combination of cash and additional borrowings.
Today Joy Global closed $ 88.36 + 0.88 (1.01%), upon the announcement of this acquisition.