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Caterpillar buys mining firm Bucyrus for $7.6 bln

On Monday 15 November 2010, 14:23 EST

US heavy equipment giant Caterpillar said Monday it will acquire mining company Bucyrus International for some 7.6 billion dollars.

The transaction, valued at some 8.6 billion dollars plus about one billion in debt, "is based on Caterpillar's key strategic imperative to expand its leadership in the mining equipment industry," the company said in a statement.

Under the terms of a deal approved by the boards of the two companies, "Bucyrus shareholders will receive 92 dollars per share, 7.6 billion dollars in aggregate consisting of all cash," Caterpillar said.

Bucyrus, headquartered in South Milwaukee in the US state of Wisconsin, is a global leader in the manufacture of mining equipment that is used in both surface and underground mining of coal, copper, iron ore and other minerals.

Peoria, Illinois-based Caterpillar cited its intent to "capitalize on the robust long-term outlook for commodities" as rationale for the purchase.

Caterpillar chairman and chief executive Doug Oberhelman said the Bucyrus acquisition is "a strong statement about our belief in the bright future of the mining industry."