The United States Department of Justice has given the go-ahead for Caterpillar to acquire mining equipment manufacturer Bucyrus International, concluding the antitrust review process in the US.
The clearance by the DOJ will allow the acquisition, valued at approximately $8.6 billion (including net debt), to proceed as soon as all other conditions to closing have been satisfied. The transaction is expected to close in mid-2011.
The acquisition is based on Caterpillar's key strategic imperative to expand its leadership in the mining equipment industry.
"We were very pleased to hear this positive news from the Department of Justice about this strategic acquisition," said Caterpillar chairman and CEO Doug Oberhelman. “Since we announced our plan to acquire Bucyrus last November, we have continued to hear from our customers that this complementary expansion of our mining product range is what they have been looking for from Caterpillar. This will position us to better serve the increasingly complex requirements of those customers."
"This is a critical and important step as we move toward closing this historic transaction that will deliver tremendous value to all the Bucyrus stakeholders,” said Tim Sullivan, president and CEO of Oak Creek, Wisconsin-based Bucyrus.
Caterpillar will fund the acquisition through a combination of cash from its balance sheet and debt. It does not plan to issue equity to help pay for the acquisition.
