Caterpillar Inc. and Platinum Equity announce that Platinum Equity's acquisition of a majority interest in Caterpillar Logistics Services has been completed. Caterpillar will retain a 35% equity stake in the business. The overall transaction is valued at approximately $750 million.
Caterpillar Logistics Services is the third party logistics division of Caterpillar's wholly owned subsidiary, Caterpillar Logistics Inc. (Cat Logistics). Platinum intends to establish the business as a standalone company under a new brand that will be announced at a later date.
"The sale of the third party logistics business was driven by the strategic focus on the significant growth opportunities in our company's core businesses," says Steve Larson, vice president of Caterpillar and chairman and president of Cat Logistics. "We are very proud of the outstanding team that has delivered value to customers around the world for more than 25 years, and believe that in Platinum Equity we have picked the right partner to ensure strong growth and continued success for the business going forward."
Platinum Equity Partner Jacob Kotzubei is excited about the prospects for the business under new ownership.
"Caterpillar Logistics Services has tremendous opportunity ahead of it, with dedicated employees, a rich history of innovation and a compelling customer value proposition," says Kotzubei. "We look forward to building on that tradition while establishing a new identity and propelling the company to new levels of success."
A team that includes Platinum in-house operations specialists is focused on transitioning the newly acquired business. A rebranding initiative is underway, and a new corporate name and image will be announced as that process unfolds.
"It is with great confidence and excitement that our business begins our new journey today. I look forward to expanding our service offerings and continuing to provide world class, innovative logistics solutions to our current and future clients," says Dan Spellman, president and chief operating officer of Caterpillar Logistics Services LLC. "I am excited to work with Platinum Equity as our new majority owners. Their expertise executing seamless corporate carve-outs and their commitment to operational excellence will be great assets to our company."
The sale does not impact Caterpillar manufacturing logistics and transportation operations or Cat brand parts distribution. These services will continue as core businesses within Cat Logistics. As part of the sale to Platinum Equity, the divested third party logistics business will continue to provide logistics services for non Cat branded parts including FG Wilson, Perkins, Solar, as well as for Caterpillar Japan.