May 9 (Bloomberg) -- Terex Corp.’s offer for Demag Cranes AG that values the German maker of harbor cranes at about at 883.9 million euros ($1.27 billion) is “completely inadequate” and doesn’t reflect Demag’s value, its largest shareholder said.
Terex proposed on May 2 to pay 41.75 euros for each share of Dusseldorf-based Demag. That offer is “in no way reflects the value potential of the company,” Lars Foerberg, a founding partner of Cevian Capital, said by e-mail today. Stockholm-based Cevian owns about 10 percent of Demag Cranes.
Cevian, an activist fund that seeks to push for change at companies where it owns a stake, is putting pressure on Terex to increase its offer, with Demag’s stock trading above the bid since it was announced. Terex is the second suitor to pursue Demag, which rebuffed an approach in February by Konecranes Oyj.
Demag fell as much as 30 cents, or 0.7 percent, to 46 euros, and traded at 46.15 euros at 12:02 p.m.
A takeover would be the material-handling industry’s largest in at least a decade. Konecranes still targets growth through purchases of manufacturers and service companies, spokesman Mikael Wegmuller said on May 4, declining to comment on Demag.
Cevian bought the stake in Demag last year. Jens Tischendorf, a partner at Cevian, joined Demag’s supervisory board Oct. 22. Cevian and U.K. hedge funds control at least 30 percent of Demag’s shares, according to an estimate of WestLB analyst Achim Henke.
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