Caterpillar Inc. and Bucyrus International, Inc. entered into an agreement under which Caterpillar will acquire Bucyrus International in a transaction valued at approximately $8.6 billion. The acquisition is based on Caterpillar’s key strategic imperative to expand its leadership in the mining equipment industry. Caterpillar intends to locate its mining business headquarters in South Milwaukee, Wis., where Bucyrus’ headquarters is currently located, and maintain the Bucyrus brand for the principal Bucyrus legacy products. The transaction is expected to close in mid-2011.
The acquisition positions Peoria, Ill.-based Caterpillar to capitalize on the long-term outlook for commodities driven by the trend of rapid growth in emerging markets. Synergies driven by the acquisition include: market-leading sales and support capabilities of Caterpillar dealers and a broad, one-stop shop for global mining customers; Caterpillar Remanufacturing products and services for Bucyrus equipment; and Caterpillar engines and components to enhance performance and lower owning and operating costs for Bucyrus equipment.
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