The Volvo Group has announced that it is to sell its Volvo Rents business in North America to private equity company Platinum Equity for $1.1 billion.
Volvo Rents offers rental of a range of machines intended for the construction and engineering industry, including Volvo Construction Equipment (Volvo CE) products. Volvo Rents has operations in the US, Canada and Puerto Rico and 2,100 employees. Platinum Equity is a California-based investment firm with experience of investing in the equipment rental market.
“We looked at different alternatives to grow Volvo Rents' business and concluded that the best alternative is to sell the operation to another owner,” says Olof Persson, Volvo Group President and CEO.
All Volvo Rents' employees will remain with the company and Volvo Rents' customers will not be affected by the transaction. Volvo CE will continue to sell products to Volvo Rents under the new ownership and all Volvo CE's existing dealer-based rental operations are unaffected by this announcement.
The transaction is subject to certain conditions, including the approval of relevant authorities, and is expected to be closed in the first quarter of 2014.