June 5, 2010
Cat subsidiary buys EMD
Caterpillar, Inc. (NYSE:CAT) subsidiary 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. On completion of the transaction, EMD will become a wholly-owned subsidiary of Progress Rail.
Not too surprisingly the Progress Rail press release announcing the deal focuses on what it means for Cat in terms of penetrating the rail market, though it does mention that EMD is a "a global provider of diesel engines for marine propulsion, offshore and land-based oil well drilling rigs, and stationary power generation."
Presumably, under CAT ownership EMD will continue to offer its 710 series in these markets, where its two cycle design has a loyal following.