Sumitomo Construction Machinery Co of Japan and Case Corporation of the US signed a letter of intent on 20 January to extend their North American co-operation agreement into a worldwide alliance in the marketing and manufacturing of hydraulic crawler excavators.
As part of the deal, Link-Belt, Sumitomo’s crane and excavator manufacturing subsidiary in the US, becomes a 50/50 joint venture between Case and Sumitomo.
While the deal places doubt over the future of the Link-Belt brand in the excavator business (Link-Belt already makes Case-branded excavators alongside its own machines), a Case spokesman said that the Link-Belt crane business would continue as before, with the Link-Belt name and distribution.
“Link-Belt has been well run and operates profitably so we are not looking for wholesale changes,” the Case spokesman said.
Motivation for the deal is the need to be a global player in the muckshifting business to compete effectively with the likes of Caterpillar.
The fact that Case is acquiring a half-share of a crane manufacturer in the deal might be interpreted as almost accidental. But Case admits that it is “looking to expand in all construction equipment fields, including cranes”.
Asked about Case’s interest in Grove Worldwide, currently up for sale, Case would make no comment, except to say that making its first step into the crane industry with Link-Belt, made further deals in the crane business neither more nor less likely.
The deal is expected to be finalised by the end of June.
