Volvo acquires Skidsteer Loader business from Textron

12/19/2001 6:01 AM EST

VOLVO ACQUIRES SKIDSTEER LOADER BUSINESS FROM TEXTRON

Volvo Construction Equipment (Volvo CE) today signed an agreement to
acquire the assets of Scat Trak, the skidsteer loader business of
Textron's (NYSE: TXT) subsidiary OmniQuip. The assets include exclusive
manufacturing and product design rights to a complete range of 8
different skidsteers ranging from 1350 lbs to 2450 lbs operating
capacity, tooling and inventory. Manufacturing facilities are not part
of the agreement.

The acquisition adds an important line of products to Volvo CE's compact
offering and will, at the same time, strongly reinforce the Company's
recently launched rental initiative. The product range will be further
developed and launched globally under the Volvo brand during the fall of
2002. The products will be assembled at Volvo CE's Asheville plant
(North Carolina).

"Compared to the market's leading skidsteers, the Scat Trak machine
emerged as a very competitive product. Its recognized performance,
together with Volvo's brand and strength in distribution, will be
extremely beneficial for our dealers and customers," says Mr. Tony
Helsham, President & CEO of Volvo CE.

"This is a unique opportunity for Volvo, both from a timing and a value-
added point of view, without adding any manufacturing capacity, we have
acquired a first class product, which is essential to the further
development and broadening of our product range," says Mr. Leif
Johansson, President & CEO of AB Volvo. "The recent announcements
regarding the launch of the internally developed Backhoe Loader, the
acquisition of the UpRight telehandler product line and now the
skidsteer product line emphasize Volvo's commitment to the construction
equipment business. These product additions together with the
discussions with Komatsu represent a new and very exciting phase in the
development of Volvo CE."

OmniQuip will supply and support the Scat Trak products in the market
until the Volvo CE launch after which Volvo CE will take over the
service and parts' support to the existing machines.

A skidsteer loader is a highly versatile tool carrier used across a wide
range of construction applications. The total worldwide market is around
90,000 units per year.

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For further information, please contact:
Mr. Klas Magnusson
Senior Vice President Corporate Communications
Volvo Construction Equipment
Tel: +32 2 482 5065
Mobile: +32 475 576214

December 19, 2001

Volvo Construction Equipment is a major international company
developing, manufacturing and marketing equipment for construction and
related industries. Its products, leaders in many world markets, include
a comprehensive range of wheel loaders, hydraulic excavators,
articulated haulers, motor graders and compact equipment. Volvo
Construction Equipment is part of the Volvo Group, world-leading
manufacturer of trucks, buses, construction equipment, marine and
industrial engines, and aerospace systems and components.