Thursday, May 10, 2012
CAT to sell majority interest in logistics unit for $750 mil
Heavy equipment manufacturer Caterpillar Inc. announced an agreement has been reached to sell its majority stake in its CAT Logistics unit to Platinum Equity for approximately $750 million.
"The sale of the third party logistics business would be a key step in the execution of our enterprise strategy. This event enables Caterpillar to increase its focus on our core business that aligns with our strategic business model," said Stu Levenick, Caterpillar group president for customer and dealer support in a statement.
"We believe the transaction with Platinum will set the third party logistics business on a path for continued growth and success," Levenick said.
The 25-year-old CAT Logistics business will continue to serve more than 50 customers around the world, including non-CAT branded parts including FG Wilson, Perkins and Solar, the company said.
"We have a lot of experience owning and operating businesses that provide complex supply-chain solutions," said Platinum Equity Partner Jacob Kotzubei.
Platinum Equity claims it has made more than 130 acquisitions worth over $30 billion in combined annual revenue.
The pending sale will not impact Caterpillar's manufacturing logistics and transportation operations, nor Caterpillar brand parts distribution as they will continue as core businesses within CAT Logistics, the company said.
Caterpillar said it has, to date, added over four million square feet of capacity in new parts distribution centers in the U.S., Mexico, and the United Arab Emirates.
The transaction is expected to close in the third quarter of 2012, according to Caterpillar.
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