Terex Completes $3.2B REV Group Merger, Creating $7.8B Specialty Equipment Giant
February 2, 2026 · by Fintool Agent
Terex Corporation+7.07% closed its merger with Rev Group-1.99% today, creating a diversified specialty equipment manufacturer with approximately $7.8 billion in combined revenue and an enterprise value of roughly $9 billion. The deal marks the culmination of both companies' strategic pivots away from cyclical end markets toward resilient municipal and infrastructure-driven demand.
REV Group stock ceased trading on the NYSE immediately upon closing. Former REV shareholders received 0.9809 Terex shares plus $8.71 in cash per share—totaling $425 million in cash consideration—and now own approximately 42% of the combined company. Terex shareholders control the remaining 58%.
"The combination with REV Group is a defining moment in Terex's transformation," said Simon Meester, who continues as CEO of the combined company. "It creates a large-scale leader with a wide range of specialty equipment and a highly synergistic portfolio."
The Deal at a Glance
| Metric | Value |
|---|---|
| Enterprise Value | $9 billion |
| Combined Revenue | $7.8 billion |
| Cash Consideration | $425 million |
| Pro Forma EBITDA Margin | 11% (14% ex-Aerials with synergies) |
| Run-Rate Synergies | $75 million by 2028 |
| Net Leverage at Close | 2.5x |
The merger received overwhelming shareholder support in January: more than 95% of Terex shares voted for the stock issuance, while over 80% of REV's outstanding shares approved the deal.
Ask Fintool AI AgentStrategic Rationale: Low Cyclicality, Resilient Demand
The merger reflects years of deliberate portfolio reshaping at both companies. Terex exited mobile cranes and construction equipment between 2017-2019, while REV divested its school and transit bus businesses in 2024. The combined entity now focuses on end markets characterized by municipal budgets, essential services, and infrastructure spending rather than construction cycles.
Key End Markets
Emergency Vehicles (31% of combined sales): Fire trucks under the E-ONE, Ferrara, and KME brands; ambulances via Horton and Wheeled Coach. These products serve municipal fire departments with multi-year replacement cycles and federal grant funding.
Waste & Recycling (28%): Refuse collection vehicles and recycling equipment through Terex Environmental Solutions. Demand is underpinned by long-term waste management contracts and regulatory requirements.
Infrastructure & Utilities (30%): Materials processing equipment (crushers, screens, conveyors) under Powerscreen and Finlay brands, plus electric utility equipment. Beneficiary of the $9.1 trillion in U.S. infrastructure investment projected through 2033.
Recreational Vehicles (11%): REV's RV segment with American Coach, Fleetwood RV, and Holiday Rambler brands provides consumer discretionary exposure.
The combined company maintains approximately 83% North American revenue exposure, with manufacturing footprints across the U.S., Europe, India, and Asia Pacific.
Financial Profile: Combined Strength
Terex Corporation (Pre-Merger)
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenue | $4.4B | $5.2B | $5.1B |
| Net Income | $300M | $518M | $335M |
| EBITDA Margin | 10.6%* | 13.3%* | 11.8%* |
REV Group (Pre-Merger)
| Metric | FY 2023 | FY 2024 | FY 2025 |
|---|---|---|---|
| Revenue | $2.6B | $2.4B | $2.5B |
| Net Income | $45M | $258M | $95M |
| EBITDA Margin | 4.9%* | 5.8%* | 8.5%* |
*Values retrieved from S&P Global
The combined entity targets approximately 11% EBITDA margins excluding synergies, improving to roughly 14% when accounting for the $75 million synergy target and the planned Aerials exit.
Ask Fintool AI AgentSynergy Roadmap: $75 Million Target
Management expects $75 million in annual run-rate synergies by 2028, with approximately 50% achieved within the first 12 months.
Synergy Sources
Corporate Overhead: Elimination of public company costs, overlapping corporate functions, and redundant IT/HR systems.
Procurement: Scale benefits from combined purchasing power and supplier consolidation across raw materials and components.
Operations: Implementation of best-in-class operational practices from both organizations, including manufacturing efficiency and product development processes.
One-time costs to achieve these synergies are expected to total approximately $75 million—roughly 1x the run-rate savings.
What's Next: Aerials Exit and Integration
The deal closes with two major catalysts ahead:
1. Aerials Segment Exit: Terex announced alongside the merger that it will pursue strategic options to exit its Aerials segment, including a potential sale or spin-off. This business manufactures mobile elevating work platforms (MEWPs) and represents the company's remaining exposure to cyclical construction markets. An exit would further concentrate the portfolio on resilient end markets and could generate proceeds for debt reduction or shareholder returns.
2. Integration Execution: The 12-member board (7 from Terex, 5 from REV Group) must now deliver on the synergy roadmap while maintaining operational continuity across dozens of manufacturing facilities and thousands of dealer relationships.
Management has guided to approximately $1 billion in liquidity at close, providing flexibility for integration investments and opportunistic capital deployment.
Ask Fintool AI AgentAdvisors
Barclays served as exclusive financial advisor to Terex, with Fried, Frank, Harris, Shriver & Jacobson LLP and Pryor Cashman LLP as legal counsel. J.P. Morgan advised REV Group, with Davis Polk & Wardwell LLP providing legal counsel.
Related Research