Bobcat sold

[Tigerotor77W]

... to Doosan (formerly Daewoo)

http://www.reuters.com/article/hotStocksNews/idUSN3023327120070730

 

[Wolf]

price almost $5 BILLION

huge price for that company. question whether the value is there . . .

 

[TALLRICK]

A dollar is not worth what it once was, that's for sure. Not certain why they would pay so much for a product they already make in another form. Perhaps just a way to control the competition?

 

[Ross]

Well the Doosan dealer in this area (UK Daewoo) are really good (100% Better than MTS Bobcat). Maybe this is due to the fact Daewoo make pretty good machine's. Only hope the Quality and dealer service filters down from Doosan.

Ross

 

[KSSS]

They do make a competetive product but it has no market penetration. I believe they are buying:

Marketshare in the compact equipment arena

Immediate international credibility

Along with marketshare an opportunity to service guys with Bobcat
equipment and hopefully display a level of service that may lead to larger sales of heavy equipment.

A developed income stream that is already established and flowing (granted not as fast as it has in the past).

Showcase Doosans obvious committment to the industry

There is discussion on other forums about what to expect next from Doosan and the Bobcat brand. I don't think you will see any changes not even nominal (color change). I am sure they will stamp Doosan on the machines but I think it will be sometime before they rock that boat.

 

[CEwriter]

huge price for that company. question whether the value is there . . .

They'll get their money's worth in North American distribution alone.

Over time, 70% of global construction equipment sales take place in North America. To be a global player, you almost have to have significant presence here. There is an exception or two -- JCB, for instance. And the strength of the European market has temporarily elevated the profiles of some nameplates that have weak distribution here.

The challenge of North American market share is finding enough local business people with capital and expertise to represent your product. There's just not enough ROI in the equipment distribution business for a company like Doosan (or JCB, or even Volvo) to entice a lot of entrepreneurs to start new businesses to sell construction equipment. Even if they could, the manufacturer's stockholders will be streaming for the exits well before a bunch of startup dealerships gain reasonable market share.

So the name of the game -- especially here on the tail end of a peak in the construction-equipment industry's business cycle -- is to buy distrubution. Doosan just did.

I don't know how many Bobcat dealers there are in North America, but I'm guessing it's plenty. At a Bobcat dealer event last December, where they introduced their largest excavator, it was said that dealers are calling for bigger machines. Many would like to have larger excavators to offer, rather than sending existing customers looking for heavier iron down the road. Doosan's product line is probably well suited for that kind of customer.

Bobcat's name recognition doesn't hurt either. And don't forget that the $4.9B included Ingersoll Rand's utility equipment and attachments groups as well. That includes the Geith name, and Montabert/Tramac hydraulic hammers (I think).

The big question related to the big price tag is whether or not Doosan can service the debt long enough to realize the benefits of Bobcat's distribution and name. No matter what the benefits, it's still going to take a long time to make serious changes in their marketing. Almost everything in the construction equipment industry does.

I wouldn't worry about Doosan too much, though. It's a company with what looks like pretty significant market share in the global power-plant and water-desalinization plant markets. I think they have the cash flow to swing it.

Should be interesting to watch what happens to the Bobcat brand.

Just my .02

Larry

PS: Somebody at Ingersoll Rand is looking like a genious, with the incredible prices they got for the road development group and Bobcat. Shame that such a venerable name in the construction-equipment business is making its exit, though.

 

[jazak]

I wonder how this will effect how the Bobcats are produced and if there will be any changes?

 

[Wolf]

Bobcat

Shame that such a venerable name in the construction-equipment business is making its exit, though.

Couldn't imagine them dropping the Bobcat brand name, even though it's got a new owner. Ingersol didn't drop the Bobcat name when they acquired Bobcat from Melroe a few years back.

 

[jazak]

Couldn't imagine them dropping the Bobcat brand name, even though it's got a new owner. Ingersol didn't drop the Bobcat name when they acquired Bobcat from Melroe a few years back.

Yep, I highly doubt they'll drop the name. I mean how else are they going to get their $$$$ back? When you compare a Bobcat to a CASE or CAT it has some big downfalls. IMO

 

[bdawg]

i thought volvo just bought ir and bobcat or did i miss something???

 

[Countryboy]

Welcome to HEF bdawg! :drinkup

 

[CEwriter]

i thought volvo just bought ir and bobcat or did i miss something???

Maybe just a little confusion. Volvo bought the Road Development group from Ingersoll Rand -- Blaw Knox, ABG, and IR pavers, rollers, and support equipment.

There was a bunch of scuttlebutt that they might be in the running to buy Bobcat from Ingersoll Rand as well. Chances are very good that IR offered Bobcat to Volvo, but it looks like the Swedes didn't like the price. They didn't bite, leaving Bobcat on the market for Doosan to step in.

L

 

[CEwriter]

Here's a short that we published when Volvo bought IR Road Development

http://www.constructionequipment.com/article/CA6421471.html?q=volvo+road+development

 

[Tigerotor77W]

it looks like the Swedes didn't like the price. They didn't bite, leaving Bobcat on the market for Doosan to step in.

Can't wait to see the CE writeup on this sale -- it sure will cause a stir in every major magazine.

But I'm wondering what will happen to the brand. I think Doosan knows (or would hope it knows) that Bobcat's following isn't going to stay as strong with its current SSL-CTL line. Contractors who want a name turn first to Bobcat, but if they demo other brands, generally it seems like they've been finding a better value (either lower cost or more performance -- or both). I think the fun part is about to begin, even though the bid speculations were mighty, mighty interesting (and my predications were completely wrong).

 

[EquipmentEditor]

Here's CE's write up on the Doosan purchase:
http://www.constructionequipment.com/article/CA6466803.html

Can't argue with anything said here.
I agree wholeheartedly that the Bobcat name is not going anywhere. Well, at least in the near future. All bets are off for everything more than a few years out.:beatsme

 

[Tigerotor77W]

Thanks for the post. It'll be interesting to see what happens to the products currently in the development pipeline... and yes, there are products in that white model of efficiency and secrecy.

 

[jazak]

Well the doosan dealer just bought a ton of equipment.....he's right across fromt the CAT dealer here.