China's Zoomlion Heavy Industry Science and Technology Co Ltd , which is bidding to buy US crane maker Terex Corp for about $3.4 billion, on Wednesday reported its lowest annual profit in 15 years. Net income dropped 85 percent to 89 million yuan ($13.74 million) in 2015, the company said in a stock exchange filing, the lowest since 2000 when it reported 54 million yuan in net income. Revenue fell 19.7 percent to 20.8 billion yuan.
It was the fourth consecutive year of profit decline. The result, which was highly anticipated, may add momentum to the Terex bid, as Zoomlion seeks to address problems at home by acquiring assets overseas. Chinese heavy equipment makers are battling an historic glut of unsold equipment, unused factories and tumbling earnings following a massive construction boom initiated by a $644 billion government stimulus package announced in 2008.
Zoomlion's acquisition of Terex could provide access for the Chinese maker of concrete and earthmoving heavy equipment to North American markets, where its same-town rival Sany Heavy Industry Co Ltd already has an assembly plant. Terex said last week it was moving forward with negotiations after Zoomlion raised its bid for the company to $31 per share, increasing its offer to about $3.40 billion from $3.29 billion, based on the company's total diluted outstanding shares as of December 31, 2015.