Aloysius Rauen, Chairman of the Board of Demag Cranes AG, and Han Xianbao, Chairman and President of the Weihua Group have signed a letter of intent to this effect in Beijing. As part of the agreement, Demag Cranes will initially acquire a minority interest in the Weihua Group’s crane business while Weihua will grant Demag the option to participate in the industrial management of the Group by taking a majority stake in the medium term. Both companies have agreed on exclusivity regarding further negotiations. Once the companies have combined, they will form one of the leading companies in its industry in China.
The Weihua Group’s crane business includes the manufacture and marketing of industrial cranes, harbour cranes and crane components and it is one of the few suppliers in China with pan-regional representation. The company’s headquarters is in Henan province, Central China.
Founded in 1988, the Group has 5,000 employees and a generated revenue of RMB 2.5bn (approximately EUR270m) with its crane business in 2009. Han Xianbao and his family have a 100% holding in the Weihua Group and the agreement stipulates that Han Xianbao will continue to hold a leading position in Weihua in future.
Demag Cranes’ CEO, Aloysius Rauen said, “Our planned strategic alliance with Weihua is a major step for our company (and) we will be able to strengthen our position in the dynamically growing Chinese market considerably.
According to Han Xianbao, “The planned cooperation with Demag Cranes is an excellent opportunity for Weihua to use and develop new products together and to tap into international markets where Demag Cranes is well positioned with its Demag and Gottwald brand names.”