Caterpillar said it has signed a nonbinding memorandum of understanding along with Mitsubishi Heavy Industries Ltd. (MHI) and Shin Caterpillar Mitsubishi Ltd. (SCM) for a plan that would result in a new ownership structure for SCM, which is currently split 50-50.
Cat said the companies are in discussions “with the intention of reaching definitive agreements” for a plan where Caterpillar would own the majority of the outstanding shares of SCM, with MHI owning the remaining shares.
SCM is primarily involved in the design, manufacture and sale of Caterpillar branded construction and earthmoving equipment. SCM also owns several Caterpillar dealers and Caterpillar rental stores located in key markets in Japan. The venture that resulted in SCM was established in 1963, and had $3.2 billion in the business year ended March 2006.
SCM production facilities in Akashi and Sagami are major manufacturing centers, providing Caterpillar products to Asia and the world, Cat said. In addition, Shin Caterpillar Mitsubishi`s hydraulic excavator design center in Akashi is the global home for the design of Caterpillar`s hydraulic excavator product line.
Mitsubishi Heavy spokesman Hideo Ikuno said the sale of part of its stake in the joint venture, Shin Caterpillar Mitsubishi Ltd., was in line with a strategy of shifting resources to core businesses such as power systems, aerospace and turbo chargers. Construction machinery is no longer considered a core operation.
Caterpillar`s board of directors has voted in support of proceeding with the discussions for the plan, Cat said. In conjunction with the plan, Caterpillar and MHI have also agreed to discuss the creation of a new comprehensive joint venture agreement as well as certain definitive agreements for implementation of the plan. These definitive agreements would be subject to applicable regulatory approvals.
|
English
Espanol
Русский
Articles