Caterpillar to Purchase Chinese Construction Equipment Manufacturer

BEIJING – Caterpillar announced this week the signing of a definitive agreement to acquire Shandong SEM Machinery Co., one of China’s key wheel loader manufacturers.

The acquisition is the latest step in a multi-year strategy introduced by Caterpillar in 2003 to significantly expand its presence in China. Under the signed agreement, Caterpillar will purchase a minority interest in SEM, with options to purchase the remaining equity after two years.

"In finalizing this deal, Caterpillar has reached another significant milestone in increasing our presence in China...[which] now represents the world's fastest growing construction equipment market opportunity,” said Richard Lavin, Caterpillar’s vice president of Asia Pacific operations. “The strong relationship that has been built between Caterpillar, SEM and the Shandong Province further strengthens our foundation for growth in China.”

Caterpillar currently operates 10 facilities – both joint venture and wholly owned businesses – and employs approximately 2,000 people throughout China. The company distributes its products through five independent Caterpillar dealers.