ALBERTVILLE, Ala.—Progress Rail Services has signed a definitive agreement
to purchase Electro-Motive Diesel (EMD) for $820 million in cash from Berkshire
Partners LLC and Greenbriar Equity Group LLC. Upon completion of the transaction,
EMD will become a wholly-owned subsidiary of Progress Rail. Progress Rail is a
wholly-owned subsidiary of Caterpillar Inc. (NYSE: CAT).
“This acquisition represents the latest step in our strategic plan to aggressively
grow our presence in the global rail industry,” said Caterpillar Vice Chairman and CEOElect
Doug Oberhelman. “Including today’s announcement and our acquisition of
Progress Rail, Caterpillar has invested about $2 billion since 2006 to grow our profitable
rail and transit businesses. Rail has proven to be a highly efficient and sustainable method
for moving freight and people, and we see a positive long-term future for the continued
growth of the rail industry.”
Progress Rail Services is one of the largest providers of rail and transit products
and services in North America, including: locomotive upgrade and repair, railcar remanufacturing, trackwork, rail welding, rail repair and replacement, signal design and
installation, maintenance of way equipment, parts reclamation and recycling.
“The acquisition of EMD will enable us to provide rail and transit customers an
industry-leading range of locomotive, engine and emissions solutions, as well as
unmatched aftermarket product and parts support and a full line of rail-related services
and solutions,” said Progress Rail CEO Billy Ainsworth.
“We are very proud to have had the opportunity to partner with EMD’s
management in rebuilding this rail industry icon,” said Regg Jones, managing partner of
Greenbriar. “Having redirected the company’s strategy and restored EMD back to strong
operating and financial footing, we are confident EMD will continue its growth and
success with Progress Rail.”
Richard Lubin, managing director of Berkshire Partners, added, “Our objectives
coming in were to transition EMD to a strong, independent company focused on its
customers, invest in EMD's technology and capabilities and drive operational
improvement. We are delighted Progress Rail will be the new owner of this business.”
The acquisition is expected to close by the end of 2010, pending final regulatory
approvals. EMD will remain headquartered in LaGrange, Ill. John Hamilton will
continue as president and CEO of EMD and will report to Billy Ainsworth.
About Progress Rail:
Progress Rail Services, a wholly-owned subsidiary of Caterpillar Inc., is a leading
supplier of remanufactured locomotive and railcar products and services to the railroad
industry, operating one of the most extensive rail service and supply networks in North
America. We serve our customers through a network of more than 125 locations across
the United States, Canada, Mexico, Brazil, Italy, Germany and the United Kingdom, with
more than 4,300 employees. Progress Rail Services is headquartered in Albertville,
Ala. For more information, visit www.progressrail.com.
About Electro-Motive Diesel:
Founded in 1922, Electro-Motive (EMD) is one of two U.S. original equipment
manufacturers of diesel-electric locomotives. Headquartered in LaGrange, Ill., with
additional facilities in London, Ontario, and San Luis Potosi, Mexico. EMD designs,
manufactures and sells diesel-electric locomotives for all commercial railroad
applications and has sold its products in more than 70 countries worldwide. The company
is the only diesel-electric locomotive manufacturer to have produced more than 70,000
engines and has the largest installed base in both North America and worldwide. In
addition to its manufacturing activities, EMD has an extensive aftermarket business
offering customers replacement parts, maintenance solutions, and a range of value-added
services. The company is also a global provider of diesel engines for marine propulsion,
offshore and land-based oil well drilling rigs, and stationary power generation. Additional
information can be found at: www.EMDiesels.com. |
|
|
|
