H&E Equipment Services, Inc. (NASDAQ: HEES) (\u201cH&E\u201d) announced that it has entered into a definitive agreement to sell its crane business to a wholly-owned subsidiary of The Manitowoc Company, Inc. (NYSE: MTW), a leading global manufacturer of cranes and lifting solutions, for $130 million in cash. The transaction is expected to close during the fourth quarter of 2021, subject to customary closing conditions, including regulatory approval under the Hart-Scott-Rodino Act.<\/p>\n
\u201cThis transaction marks an important step in H&E Equipment\u2019s transition to a pure-play equipment rental company,\u201d said\u00a0Brad Barber, H&E\u2019s Chief Executive Officer. \u201cWe expect our continued migration to higher margin rentals will promote our strategic focus on geographic expansion and fleet investment, drive outsized revenue and profitability growth, and enable us to take full advantage of opportunities created by favorable industry and macro trends.\u201d<\/p>\n
\u201cH&E has a long history and excellent reputation for serving the lifting industry, and we look forward to welcoming the H&E crane team to Manitowoc,\u201d commented\u00a0Aaron H. Ravenscroft, President and Chief Executive Officer of\u00a0The Manitowoc Company, Inc.\u00a0As a result of the transaction, H&E will fully exit the crane distribution business.<\/p>\n
This divestiture, which was unanimously approved by H&E\u2019s Board of Directors, is expected to increase, and further stabilize the Company\u2019s EBITDA margin as it intensifies its focus on the higher margin equipment rental business.<\/p>\n
H&E\u2019s equipment rental business has shown consistent growth, with a compound annual growth rate of 11 percent in the five years leading up to 2020. This rapid growth has seen the rental portion of H&E\u2019s business expand from 32 percent of revenues 10 years ago to 51 percent in 2020. The overall demand for equipment rentals has continued to expand and has proven to be more stable and resilient to market disruptions than the distribution business.<\/p>\n
Possible uses of proceeds from the transaction include, but are not necessarily limited to, further expansion of new facilities, investment in the rental fleet, and the delivery of a differentiated customer experience through enhanced technology capabilities. In addition, the proceeds will fortify the Company\u2019s strong cash position while supporting strategic growth initiatives and ongoing dividends.<\/p>\n","protected":false},"excerpt":{"rendered":"
H&E Equipment Services, Inc. (NASDAQ: HEES) (\u201cH&E\u201d) announced that it has entered into a definitive agreement to sell its crane business to a wholly-owned subsidiary of The Manitowoc Company, Inc. (NYSE: MTW), a leading global manufacturer of cranes and lifting solutions, for $130 million in cash. The transaction is expected to close during the fourth […]<\/p>\n","protected":false},"author":5,"featured_media":13962,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":""},"categories":[2,3,8],"tags":[1698,1004],"yoast_head":"\n