CHARLOTTE, Mich. (AP) -- Spartan Motors Inc. said Thursday it has agreed to pay about $45 million in cash for a privately-held Indiana manufacturer of van and truck bodies.

Spartan is buying Utilimaster Corp. from John Hancock Life Insurance Co., a unit of Canadian financial services company Manulife Financial Corp.

Utilimaster makes truck bodies and specialty vehicles used in the delivery and service market, such as walk-in vans.

It has about 550 employees and more than 550,000 square feet of manufacturing capacity at its corporate headquarters in Wakarusa, Ind.

Spartan Motors, based in Charlotte, Mich., makes specialty vehicles and chassis for use in the recreational vehicle, fire truck, ambulance and defense markets.

Mike Kitson, president and CEO of Utilimaster, called the deal an "excellent strategic fit," giving the two companies an opportunity to "attack new growth markets beyond those we could penetrate individually."

The acquisition will help Spartan enter the North American delivery and service market and gain expertise in fabrication, said John Sztykiel, president and CEO of Spartan Motors.

It is expected to add about $105 million a year in revenue and slightly reduce earnings in the first full year and add to profit by the second year, Spartan Motors said.

The acquisition will be financed with a combination of cash and debt. The closing is expected on Nov. 30.

Shares of Spartan Motors rose 3 cents to $5.28 in morning trading.