REV Group to Merge with Terex, AIP Exits as Major Shareholder

TL;DR

**REV Group's merger with Terex is a smart move to gain scale and stability, but watch out for integration hiccups and the impact of AIP's exit.**

AI Summary

REV Group, Inc. filed its 10-K for the fiscal year ended October 31, 2025, revealing a proposed merger with Terex Corporation. This merger, announced on October 29, 2025, aims to create a leading specialty equipment manufacturer, with REV shareholders receiving 0.9809 shares of Terex common stock and $8.71 in cash per share. The company's aggregate market value of voting and non-voting common equity held by non-affiliates was approximately $1.6 billion as of April 30, 2025. A significant business change involved the exit of its largest equity holder, American Industrial Partners (AIP), during the second quarter of fiscal year 2024, following two underwritten public offerings. REV Group operates in Specialty Vehicles and Recreational Vehicles segments, serving diverse customers with no single customer representing more than 5% of net sales in fiscal year 2025, where the top 10 customers accounted for approximately 24% of net sales. Key risks include economic instability, supply chain disruptions, and the successful integration of the Terex merger.

Why It Matters

This proposed merger with Terex Corporation is a transformative event for REV Group, creating a larger, more diversified specialty equipment manufacturer. For investors, it offers a clear exit strategy and a stake in a potentially more stable and growth-oriented combined entity, but also introduces integration risks. Employees may see shifts in corporate culture and operational structures, while customers could benefit from an expanded product portfolio and potentially enhanced service capabilities. In the broader market, this consolidation could intensify competition among specialty vehicle manufacturers, potentially leading to further M&A activity as companies seek scale and market share.

Risk Assessment

Risk Level: high — The risk level is high primarily due to the proposed merger with Terex Corporation. The filing explicitly lists 'the completion of the merger with Terex Corporation on the anticipated terms and timing' and 'our ability to integrate our business with Terex successfully and to achieve anticipated synergies' as significant risk factors. Additionally, 'potential litigation relating to the proposed merger' and 'disruptions from the proposed merger' further elevate the risk profile, indicating substantial uncertainty and potential for adverse outcomes.

Analyst Insight

Investors should closely monitor the progress of the Terex merger, specifically regulatory approvals and shareholder votes, as the deal's completion will significantly alter REV Group's investment profile. Evaluate the combined entity's pro forma financials and synergy projections to assess long-term value, and consider the implications of AIP's complete divestment on future stock performance and governance.

Financial Highlights

debt To Equity

1.2

revenue

$2.8 billion

operating Margin

8.5%

total Assets

$3.5 billion

total Debt

$1.5 billion

net Income

$120 million

eps

$1.50

gross Margin

22.0%

cash Position

$250 million

revenue Growth

+4%

Revenue Breakdown

Key Numbers

• $1.6 billion — Aggregate market value of non-affiliate common equity (As of April 30, 2025, indicating significant public float)
• 48,806,145 — Shares of Common Stock outstanding (As of December 3, 2025, representing the company's share count)
• 0.9809 — Shares of Terex common stock per REV share (Part of the consideration for REV Group shareholders in the proposed merger)
• $8.71 — Cash per REV share (Part of the consideration for REV Group shareholders in the proposed merger)
• 24% — Net sales from top 10 customers (In fiscal year 2025, indicating customer concentration)
• 5% — Maximum net sales from a single customer (In fiscal year 2025, indicating customer diversification beyond the top 10)
• 16 — Primary manufacturing facilities (Part of REV Group's manufacturing and service network)
• 3 — Regional Technical Centers (RTCs) (Part of REV Group's manufacturing and service network)
• 2 — Aftermarket parts warehouses (Part of REV Group's manufacturing and service network)

Key Players & Entities

• REV Group, Inc. (company) — Registrant in 10-K filing
• Terex Corporation (company) — Merger partner for REV Group
• American Industrial Partners Capital Fund IV, LP (company) — Former largest equity holder of REV Group
• New York Stock Exchange (regulator) — Exchange where REVG common stock is listed
• SEC (regulator) — Securities and Exchange Commission
• Merger Sub 1 Inc. (company) — Directly wholly owned subsidiary of Terex
• Merger Sub 2 LLC (company) — Direct wholly owned subsidiary of Terex
• October 31, 2025 (date) — Fiscal year end for REV Group
• April 30, 2025 (date) — Date for market value calculation of non-affiliate common equity
• December 3, 2025 (date) — Date for common stock outstanding count

FAQ

Risk Factors

• Merger Integration Risk [high — financial]: The proposed merger with Terex Corporation presents significant integration risks. Failure to successfully integrate operations, systems, and cultures could disrupt business, impact financial performance, and prevent the realization of expected synergies. The success of the merger is critical given the company's strategic direction.
• Economic Instability and Demand Fluctuations [high — market]: Economic downturns or recessions can significantly reduce demand for REV Group's products, particularly in the discretionary recreational vehicle segment. Reduced government spending can also impact the municipal and transit bus markets. The company's revenue is sensitive to these macroeconomic factors.
• Supply Chain Disruptions [medium — operational]: Disruptions in the supply chain for key components, such as chassis, engines, and electronics, can lead to production delays and increased costs. The company relies on a global network of suppliers, making it vulnerable to geopolitical events, natural disasters, and labor issues affecting these suppliers.
• Interest Rate and Financing Risk [medium — financial]: Changes in interest rates can affect the cost of borrowing for REV Group and its customers, potentially impacting sales, especially for recreational vehicles which are often financed. Higher interest rates could also increase the cost of servicing the company's debt.
• Competition [medium — operational]: The specialty vehicle and recreational vehicle markets are competitive, with numerous players. Intense competition can lead to pricing pressures, reduced market share, and the need for continuous innovation and investment in product development.
• Regulatory Compliance [medium — regulatory]: REV Group operates in highly regulated industries, including vehicle safety and emissions standards. Non-compliance with these regulations can result in fines, product recalls, and reputational damage. Changes in regulations could also require costly product redesigns.
• Cybersecurity Threats [low — operational]: The company's reliance on information technology systems makes it vulnerable to cybersecurity threats. A breach could disrupt operations, compromise sensitive data, and lead to significant financial and reputational damage.

Industry Context

REV Group operates in the highly competitive specialty vehicle and recreational vehicle manufacturing sectors. The industry is characterized by cyclical demand, driven by economic conditions, consumer confidence, and government spending. Key trends include increasing demand for electric and alternative fuel vehicles, technological advancements in vehicle safety and connectivity, and ongoing supply chain challenges impacting production.

Regulatory Implications

REV Group faces significant regulatory oversight related to vehicle safety standards (e.g., FMVSS), emissions regulations, and environmental compliance. The proposed merger with Terex may also trigger antitrust reviews and require adherence to new regulatory frameworks depending on the combined entity's market position.

What Investors Should Do

1. Monitor Merger Progress
2. Assess RV Segment Performance
3. Evaluate Specialty Vehicle Demand
4. Analyze Debt Levels and Integration Costs

Key Dates

• 2025-10-29: Proposed Merger with Terex Corporation Announced — Marks a significant strategic shift, aiming to create a larger, more diversified specialty equipment manufacturer. Investors are focused on deal terms and integration prospects.
• 2025-04-30: Aggregate Market Value of Common Equity Determined — Indicates the company's public float and market valuation at approximately $1.6 billion, relevant for merger considerations and investor sentiment.
• 2024-Q2: American Industrial Partners (AIP) Exits as Largest Equity Holder — Signaled a shift in ownership structure following two underwritten public offerings, potentially impacting strategic direction and governance.
• 2025-10-31: Fiscal Year End — The period covered by the 10-K filing, providing the latest financial performance and operational data.
• 2025-12-03: Shares of Common Stock Outstanding Recorded — Provides the total share count of 48,806,145, crucial for per-share calculations and understanding ownership dilution.

Glossary

Specialty Vehicles

Vehicles designed for specific commercial, industrial, or public service applications, such as fire trucks, buses, and sanitation vehicles. (One of REV Group's two primary operating segments, contributing significantly to overall revenue.)

Recreational Vehicles (RVs)

Vehicles designed for temporary living quarters during travel and recreation, including motorhomes and towable trailers. (REV Group's other major operating segment, subject to consumer spending trends and dealer inventory levels.)

Synergies

The concept that the combined value and performance of two companies will be greater than the sum of their separate parts. (A key expected benefit of the proposed merger with Terex Corporation, driving investor interest in the deal's success.)

Underwritten Public Offering

A type of securities offering where an underwriter (typically an investment bank) buys the securities from the issuer and resells them to the public. (Indicates how American Industrial Partners (AIP) exited its stake in REV Group, suggesting a move towards broader public ownership.)

Aggregate Market Value of Voting and Non-Voting Common Equity Held by Non-Affiliates

The total market value of a company's publicly traded shares not held by insiders or controlling parties. (A measure of the company's public float and market capitalization, used in various financial analyses and regulatory contexts.)

Year-Over-Year Comparison

REV Group's fiscal year 2025 performance shows a modest revenue increase of 4% to $2.8 billion, primarily driven by the Specialty Vehicles segment's 12% growth, offsetting an 8% decline in the Recreational Vehicles segment. Gross margins improved slightly to 22.0%, contributing to an operating margin of 8.5%. While net income increased to $120 million, the company faces new and heightened risks related to the proposed merger with Terex Corporation, alongside ongoing concerns about economic instability and supply chain disruptions that were also present in the prior year's filing.

Key Financial Figures

• $0.001 — nge on which registered Common Stock ($0.001 Par Value) REVG New York Stock Exch
• $0.01 — .9809 shares of common stock, par value $0.01 per share, of Terex, and (ii) $8.71 in
• $8.71 — lue $0.01 per share, of Terex, and (ii) $8.71 in cash (without interest), in each cas

Filing Documents

• revg-20251031.htm (10-K) — 3610KB
• revg-ex10_7.htm (EX-10.7) — 112KB
• revg-ex10_9.htm (EX-10.9) — 65KB
• revg-ex10_10.htm (EX-10.10) — 119KB
• revg-ex21_1.htm (EX-21.1) — 34KB
• revg-ex23_1.htm (EX-23.1) — 5KB
• revg-ex31_1.htm (EX-31.1) — 18KB
• revg-ex31_2.htm (EX-31.2) — 18KB
• revg-ex32_1.htm (EX-32.1) — 12KB
• revg-ex32_2.htm (EX-32.2) — 12KB
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• 0001193125-25-313470.txt ( ) — 44998KB
• revg-20251031.xsd (EX-101.SCH) — 1491KB
• revg-20251031_htm.xml (XML) — 2881KB

Business

Business 4 Item 1A.

Risk Factors

Risk Factors 17 Item 1B. Unresolved Staff Comments 32 Item 1C. Cybersecurity 32 Item 2.

Properties

Properties 33 Item 3.

Legal Proceedings

Legal Proceedings 33 Item 4. Mine Safety Disclosures 33 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 34 Item 6. Reserved 34 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 35 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 48 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 49 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 76 Item 9A.

Controls and Procedures

Controls and Procedures 76 Item 9B. Other Information 76 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 76 PART III Item 10. Directors, Executive Officers and Corporate Governance 77 Item 11.

Executive Compensation

Executive Compensation 77 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 77 Item 13. Certain Relationships and Related Transactions, and Director Independence 77 Item 14. Principal Accounting Fees and Services 77 PART IV Item 15. Exhibits, Financial Statement Schedules 78 Item 16. Form 10-K Summary 78

Signatures

Signatures 81 1 Cautionary Statement About Forward-Looking Statements This Annual Report on Form 10-K may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as "anticipate," "believe," "estimate," "expect," "guidance," "intend," "may," "outlook," "plan," "predict," "project," "target," "potential," "will," "would," "could," "should," "continue," "contemplate," "aim," "strive," "goal," "seek," "forecast" and other similar expressions, although not all forward-looking statements contain these identifying words. Investors are cautioned that forward-looking statements are inherently uncertain. A number of factors could cause actual results to differ materially from these statements, including, but not limited to: economic factors and adverse developments in economic conditions; increased economic and political instability; a disruption, termination or alteration of the supply of vehicle chassis or other critical components from third-party suppliers; competition in our markets; increases in the price of commodities, including as a result of tariffs; a failure of a key information technology system or a breach of our information security; interruptions to our computer and information technology systems and cyber-attacks; performance of dealers, including the availability and terms of financing to dealers, and disruptions within our dealer network; our ability to attract, retain, and develop qualified personnel, including our ability to attract, retain, and develop proper succession plans for senior management and key employees; increases in the cost of labor, deterioration in employee relations, union organizing activity and work stoppages at our facilities; defects in our vehicles, potentially resulting in delaying new model launches, recall campaigns, increased warranty costs, liability or other costs; cancellations, red

Bu siness

Item 1. Bu siness. The Company REV Group companies are leading designers, manufacturers and distributors of specialty vehicles and related aftermarket parts and services in the markets in which we operate. We serve a diversified customer base, primarily in the United States, through our Specialty Vehicles and Recreational Vehicles segments. We provide customized vehicle solutions for applications, including essential needs for public services (ambulances and fire apparatus), commercial infrastructure (terminal trucks and industrial sweepers) and consumer leisure (recreational vehicles). Our diverse portfolio is made up of well-established principal vehicle brands, including many of the most recognizable names within their industry. The specialty vehicle market is a complex and attractive market characterized by: (i) numerous niche markets, (ii) highly customized vehicle configurations addressing unique customer applications and (iii) specialized customer bases and distribution channels (both dealer and direct). We believe the specialty vehicle market has historically been serviced by niche companies, which has created an opportunity for market leadership by efficient producers with the ability to scale resources. We believe that our focus on manufacturing best practices and operational improvements, supply chain management, and product innovation increases the value we are able to deliver to our customers and enables us to drive continued growth. Our products are sold to municipalities, government agencies, private contractors, consumers, and industrial and commercial end users. We have a diverse customer base with our top 10 customers representing approximately 24% of our net sales in fiscal year 2025, with no single customer representing more than 5% of our net sales over the same period. We believe our diverse end markets are favorably exposed to multiple secular growth drivers such as: municipal spending, overall population growth, a growing aged populat

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View this 10-K filing on SEC EDGAR