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Oshkosh to Acquire JLG Industries

Mon October 16, 2006 - National Edition
Construction Equipment Guide

Oshkosh Truck Corporation has signed a definitive agreement to acquire JLG Industries Inc., a manufacturer of aerial work platforms and telehandler vehicles.

Oshkosh will acquire all outstanding shares of JLG for $28 per share. Total consideration, including transaction costs and assumed debt, is $3.2 billion in cash on a fully diluted basis. This transaction will create a $6 billion global specialty vehicle manufacturer.

“We have consistently executed strategies to grow this company, creating significant shareholder value during the last decade,” said Robert G. Bohn, Oshkosh’s chairman, president and chief executive officer. “The acquisition of JLG is the latest broad-based initiative in the continuing transformation of Oshkosh Truck Corporation.

“It is aligned with our historic acquisition strategy as we expand into complementary markets and it will be instrumental in building our global focus and scale that are increasingly needed to continue to be successful. It also meets our major acquisition criteria, which include market leadership, strong management, double digit growth opportunities and the expectation of earnings in excess of our cost of capital.”

JLG had $2.3 billion in revenues during fiscal year 2006 and has estimated a 20 to 25 percent increase in sales in fiscal year 2007.

“This transaction is a good fit for JLG,” said William M. Lasky, chairman, president and chief executive officer of JLG. “Oshkosh has a similar philosophy of offering premier products, creating strong market positions and delivering after-sales service and support. For the JLG team, this combination offers additional growth opportunities. For our customers, JLG will become an even stronger partner in their future success. We look forward to working with the Oshkosh management team to ensure a rapid and seamless transition.”

The acquisition has been approved by the board of directors of each company and is subject to customary closing conditions, including approval under Hart-Scott-Rodino and similar laws outside the U.S. and the approval by the shareholders of JLG. The transaction is expected to be completed within 90 days.

Upon completion of the transaction, JLG will become the largest of four business segments of Oshkosh. It continues the diversification of the company. In fiscal year 2008, the first full fiscal year of Oshkosh’s expected ownership of JLG, Oshkosh estimates that JLG will represent approximately 40 percent of its consolidated sales and operating income.

“We are pleased to be bringing a solid company like JLG into Oshkosh Truck. Their product leadership and innovative culture will be a great fit with our approach. It is evident from the strong reactions of both boards that we have an opportunity to do something very special,” Bohn said.

During the past several years, JLG, which manufactures equipment branded with the SkyTrak, Gradall and Lull names, completed a major realignment of its manufacturing facilities in the United States, Belgium and France. Consequently, Oshkosh has no plans at this time to make any significant changes to its combined manufacturing asset base or work force. JLG’s global reach is extensive, with sales and service centers on six continents, in addition to the three countries where it manufactures.

“Oshkosh has significant experience in the aftermarket parts and service sector. We believe our global distribution network and operational expertise will help us to increase JLG’s non-equipment sales and expand services to their customers,” Bohn said.

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