According to the New york Times. The American crane and heavy equipment maker  TEREX CORPORATION said on Monday that it had agreed to terminate its merger with KONECRANES, a Finnish rival, and would instead sell its material handling and port solutions business to the company for about $1.3 billion.

Terex and Konecranes announced in August that they would merge in an all-share deal, but Zoomlion of China made a competing bid in January to acquire Terex for $30 a share in cash, or about $3.3 billion. Zoomlion later raised its bid to $31 a share in March.

The latest deal with Konecranes would allow Terex to continue its discussions with Zoomlion on a sale of Terex in whole or in part. The sale to Konecranes could be terminated for a fee of $37 million if Terex and Zoomlion reach an agreement before the end of May.

The sale “to Konecranes is good for our customers, team members and shareholders,” John L. Garrison, the Terex president and chief executive, said in a news release. “In addition, it will significantly reduce Terex’s debt levels, improves our balance sheet and gives us longer term financial flexibility to invest in our business and buy back shares.”

Under the terms of the deal, Terex would receive $820 million in cash and 19.6 million shares of Konecranes. If the deal is completed, Terex would own about 25 percent of the outstanding shares of Konecranes and have the right to nominate two directors to its board.

The transaction is subject to regulatory and shareholder approval, and it is expected to close in January.