Konecranes originally bought 59.2% of the company – on 19 May – before upping its stake to 74.5% just seven days later. The original consideration amounted to around $38.5 million, Konecranes reported. The consideration for the second 15.3% stake amounted to a further $9.9m. Then, a further $10.3m worth of shares took its acquisition to 90.9%.

A final scoop of the remaining shares followed just days later.

Konecranes CEO Pekka Lundmark explained that the unique piecemeal acquisition happened this way because the company targeted individual shareholders rather than approach the leading figures within the company itself.

Hoist understands that there was around 10 major shareholders with the remainder of the company being owned by numerous small-scale investors.

“We had to do it in small steps,” said Lundmark. “The company was mainly owned by institutional investors.”

Lundmark said that Konecranes first got in touch with the management at MMH Holdings, Inc. some time in between acquiring the initial 59.2% of the company – on 19 May – before upping its stake to 74.5%, which, as we established, happened just seven days later.

He said this was an important part of the process. “We like the company,” he said, “and we hope to keep a large part ofs many of the management in their current positions as possible.” Talks have already begun with a view to achieving this.

Lundmark adds: “We think Morris is an excellent company and we hope for them to remain trading under their own identity.”

Konecranes were attracted to Morris because of its position in three crucial markets in the US – steel, wood and nuclear power. As Lundmark pointed out, Morris has around 100,000 cranes and hoists in operation and the long-term prospects in these industries remain promising.

Konecranes adds: “It also has a large installed base and the spare parts, maintenance and modernisation opportunities it represents are widespread.”

The total acquisition price amounts to approximately $64.6m. The net debt amounts to approximately $5m, which gives a total enterprise value of approximately $70m. MMH Holdings, Inc will be consolidated into the KCI Konecranes Group figures as of 1 June 2006. Operationally, MMH Holdings, Inc. continues as an independent entity within the KCI Konecranes Group.

The acquisition makes a farce of a three-year legal wrangling between Morris Material Handling and Konecranes Inc about competition for aftermarket parts, currently scheduled for trial in August. In the case, Konecranes sued for the return of a deposit of $250,000 it paid Morris during the initial stages of a previous acquisition that fell through.

Previously, MMH sued Konecranes for a trademark violation. Of course, Konecranes has always disputed these allegations.

It is not yet clear exactly what will happen, said Lundmark. “But,” he joked, “it is unlikely that we were going to continue to sue ourselves.” Thus, all outstanding legal matters have been closed.

The final act of the acquisition saw Konecranes Inc.’s subsidiary, HMM Acquisition Corp., further increase its stake in MMH Holdings, Inc. to 96.7% and then complete a short form merger. As a result of which Konecranes, Inc. now owns 100% of MMH Holdings, Inc. shares.

Morris Material Handling Inc. and its subsidiaries (MMH) had annual sales of approximately $170m in fiscal year 2005, which ended 31 October 2005. First half of fiscal year 2006 sales were $102m, with an operating profit of $5.5m (5.4% of sales).

MMH is expected to generate sales of approximately Eur 90m for the period June to December 2006, with an estimated EBITDA margin of 8% and an EBIT margin of 6%. The current order book stands at approximately Eur 77m.

The acquisition is expected to be earnings per share (EPS) accretive before synergies, adding approximately Eur 0.03 to KCI Konecranes EPS in year 2006. On an annualised level the positive impact before synergies equals to Eur 0.06 per share. The acquisition will temporarily increase the KCI Konecranes Group’s gearing and lower the solidity, but this effect is expected to be mitigated by positive future cash flows.

With over 120 years of history in North America, Morris Material Handling, Inc., is a recognised player in the maintenance service and overhead crane industry. The addition of MMH’s product ranges especially for the steel industry complements KCI Konecranes’ offering. The acquisition also brings new opportunities for growth in Maintenance Services through the large installed base of MMH cranes. Through its subsidiaries MMH has local operations in Canada, Mexico and Chile.

KCI Konecranes will report its half year 2006 results on Thursday August 3 2006.