UPDATE: Terex COO Plans To Leave Company By End Of January

Terex Corp. (TEX) said Wednesday its chief operating officer and the head of its cranes business have resigned as part of a management shake-up at the construction equipment manufacturer.

Terex COO Thomas Riordan, who was considered as second-in-command behind Chairman and Chief Executive Ron DeFeo, will leave the Westport, Conn., company Jan. 31. Riordan's duties, which also include president of the company, will be taken over by DeFeo. Riordan has been president and chief operating officer since 2007. Before joining Terex, Riordan had been executive vice president and chief operating officer of SPX Corp., (SPX) an electrical products manufacturer in North Carolina.

The company said Richard Nichols, formerly president of the company's cranes business, will be leaving in February. He will be succeeded by Kevin Bradley, who has been president of Terex's financial services business. Bradley will be succeeded by Ramon Oliu, who has held a variety of positions in the financial services unit since joining Terex in 2007.

Terex also said it will create a senior vice president for Terex business system. The position will be responsible for improving Terex's capabilities as a customer-focused operating company.

Like other construction machinery makers, Terex was hard hit by the economic recession and the collapse in residential and commercial construction activity in 2009. But Terex's rebound has been slower and seemingly more difficult than its peers. The company's crane business has yet to recover and demand for its Genie-brand aerial work platforms remains sluggish as equipment rental companies continue to postpone large-scale purchases of new work platforms. The company reported a third-quarter loss, even as revenue and margins improved.

Terex sold its mining equipment business to Bucyrus International Inc. (BUCY) a year ago with the intent of using the proceeds from the sale for additional acquisitions. But Terex has so far been unable to complete any deals and is likely to use a significant portion of the money to pay off debt.

Analysts said Wednesday the departure of top executives reinforces perceptions that Terex is having difficulty finding suitable acquisition targets. Terex was built through a series of discounted acquisitions engineered by DeFeo.

"It is a little worrisome that the chief operating officer has departed and is not being replaced," said Ann Duignan, an analyst for J.P. Morgan, in a note Wednesday to investors. "Investors should be concerned that this move signals that there could be a lack of acquisitions in the pipeline and therefore an operating chief is not required for [business] integration."

Terex's stock was recently trading down 0.7% at $29.96 a share.

-By Bob Tita, Dow Jones Newswires; 312-750-4129; robert.tita@dowjones.com

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