Equipment World Digital Magazine
Issue link: http://read.dmtmag.com/i/873881
EquipmentWorld.com | September 2017 13 U nited Rentals has agreed to purchase Neff Corporation for $25 per share in cash, or $1.317 billion, and expects to close on the acquisition in the fourth quarter of this year. The announcement follows the collapse of an agreement be- tween Neff and H&E Equipment Services, which Neff dissolved be- cause of United Rentals' more lucra- tive offer. H&E had offered $21.07 per share, or roughly $1.2 billion. This is the second major purchase for United Rentals this year. In April, it bought NES Rentals Hold- ings for $965 million. The company also acquired Cummins' mobile rental generator fleet in August. United Rentals says Neff's earth- moving rental business and large customer base were among the driving factors for the purchase. "We're committing to growing our core business through numer- ous avenues, and Neff is right in our wheelhouse," says United Rentals President and CEO Michael Kneeland. "They have a comple- mentary fleet and branch network serving over 15,000 customers that's very attractive to us." Kneeland says his company also sees Neff's geographical presence as an advantage. "It's concentrated in the Southern states where we've consistently seen strong demand for equipment rental services," he says. "The addition of their network will bring us greater efficiencies of scale and key markets. And Neff is well es- tablished in the infrastructure and municipal sectors." United expects a $35 million boost to EBITDA by the end of the second year of the acquisition. To make the purchase, the company is using a combination of cash, "existing capacity" under its asset- based lending facility and newly issued debt. Neff is based in Miami and focus- es on residential, industrial, energy and municipal construction in the Sunbelt region. It has 69 branches and about 1,170 employees. United Rentals has 960 rental locations in 49 states and all Canadian provinces and 13,700 employees. – Chris Hill reporter | staff report Briefs Caterpillar Group Presi- dent and Chief Financial Officer Brad Halverson will step aside in early 2018. Halverson oversees the Finance Services Division, Human Services Division, Global Information Ser- vices, Financial Products Division, Strategic Services Division, and Corporate Auditing. Komatsu's acquisition of Wis- consin-based surface and un- derground mining equipment manufacturer Joy Global helped the Japanese equipment manu- facturer more than double profits, by 133 percent, in the first quarter of the current fiscal year. Komatsu also attributed the sharp increase to higher construction equipment demand from China, Indonesia and other countries, including the United States. United Rentals to buy Neff Corporation for $1.32 billion United Rentals has 960 locations and 13,700 employees. Neff Corporation has 69 branches and about 1,170 employees. (continued on page 14)