Caterpillar to Become Sole Owner of Japanese Joint Venture
With the completion of the second phase of the share redemption plan, Caterpillar Japan Ltd. will become a 100 percent owned subsidiary of Caterpillar
TOKYO, Feb. 29, 2012 /PRNewswire/ -- Caterpillar Inc. (NYSE: CAT) and Mitsubishi Heavy Industries, Ltd. (MHI) announced today that Caterpillar Japan Ltd. (CJL) and MHI have agreed to complete a second phase of a share redemption plan in the second quarter of 2012, resulting in Caterpillar becoming the sole owner of CJL. The estimated value of the second phase of the share redemption is 36.5 billion JPY.
Caterpillar and MHI established a 50-50 joint venture more than 45 years ago known as Caterpillar Mitsubishi. In 1987, the joint venture was expanded, and the company was renamed Shin Caterpillar Mitsubishi (SCM). In 2008, following completion of the first phase of the redemption plan, Caterpillar became the majority shareholder in SCM, and the business was renamed Caterpillar Japan Ltd.
"We have enjoyed a long and successful partnership with Mitsubishi Heavy Industries, which has in turn benefited our customers in the region who have relied on our machines to help make sustainable progress possible, and we are sure that our friendly relations will continue," said Rich Lavin, Caterpillar group president with responsibility for Construction Industries & Growth Markets. "The strategic decision to fully integrate our Japanese operations into Caterpillar supports our enterprise strategy focus on competing and growing our leadership in the rapidly expanding emerging markets of Asia and the Commonwealth of Independent States," Lavin continued.
"We are proud to have the more than 5,000 CJL employees as part of the Caterpillar family," said Ali Bahaj, Caterpillar vice president with responsibility for CJL. "Full ownership of CJL by Caterpillar will enable us to better serve our customers in Japan and around the world with expanded products and services as we pursue our goal of market leadership."
Caterpillar's operations in Japan include major manufacturing centers in Sagami, which will transition to a high-tech component facility, and Akashi, which is primarily involved in the manufacture of hydraulic excavators. Akashi is also home to the company's hydraulic excavator design center, providing the design for Caterpillar's hydraulic excavator product line globally. In addition, Caterpillar owns several dealers and rental companies that provide Caterpillar products and service key markets in Japan.
For more than 85 years, Caterpillar Inc. has been making sustainable progress possible and driving positive change on every continent. With 2011 sales and revenues of $60.138 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The company also is a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services, Caterpillar Logistics Services and Progress Rail Services. More information is available at: http://www.caterpillar.com.
Certain statements in this press release relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "project," "intend," "could," "should" or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance, and we do not undertake to update our forward-looking statements.
Caterpillar's actual results may differ materially from those described or implied in our forward-looking statements based on a number of factors, including, but not limited to: (i) global economic conditions and economic conditions in the industries and markets we serve; (ii) government monetary or fiscal policies and infrastructure spending ; (iii) commodity or component price increases and/or limited availability of raw materials and component products, including steel; (iv) our and our customers', dealers' and suppliers' ability to access and manage liquidity; (v) political and economic risks and instability, including national or international conflicts and civil unrest; (vi) our and Cat Financial's ability to: maintain credit ratings, avoid material increases in borrowing costs, and access capital markets; (vii) the financial condition and credit worthiness of Cat Financial's customers; (viii) inability to realize expected benefits from acquisitions and divestitures, including the acquisition of Bucyrus International, Inc.; (ix) international trade and investment policies; (x) challenges related to Tier 4 emissions compliance; (xi) market acceptance of our products and services; (xii) changes in the competitive environment, including market share, pricing and geographic and product mix of sales; (xiii) successful implementation of capacity expansion projects, cost reduction initiatives and efficiency or productivity initiatives, including the Caterpillar Production System; (xiv) sourcing practices of our dealers or original equipment manufacturers; (xv) compliance with environmental laws and regulations; (xvi) alleged or actual violations of trade or anti-corruption laws and regulations; (xvii) additional tax expense or exposure; (xviii) currency fluctuations; (xix) our or Cat Financial's compliance with financial covenants; (xx) increased pension plan funding obligations; (xxi) union disputes or other employee relations issues; (xxii) significant legal proceedings, claims, lawsuits or investigations; (xxiii) compliance requirements imposed if carbon emissions legislation and/or regulations are adopted; (xxiv) changes in accounting standards; (xxv) failure or breach of IT security; (xxvi) adverse effects of natural disasters; and (xxvii) other factors described in more detail under "Item 1A. Risk Factors" in our Form 10-K filed with the SEC on February 21, 2012 for the year ended December 31, 2011. This filing is available on our website at www.caterpillar.com/secfilings.
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