Caterpillar Inc. says it is considering a range of strategic options for its third-party logistics business, which is part of its wholly owned subsidiary, Caterpillar Logistics Services Inc., or Cat Logistics.
Caterpillar manufacturing logistics and transportation operations and Caterpillar brand parts distribution are not part of the third-party business and are not part of this strategic review. Those operations will continue as core businesses within Cat Logistics.
In a statement, the company says it believes the 3PL business is a unique and attractive asset that has excellent growth potential.
"Over the last 24 years, the company has leveraged its traditional competitive advantage in the Caterpillar parts distribution business to create a global leader in third-party logistics, with dedicated employees, unique and attractive assets and excellent growth potential," said Caterpillar group president Stu Levenick.
Options under consideration include a potential sale of the third-party business or structuring it as an independent business within Cat Logistics.
"The third-party logistics business has been a high-performing operation within Caterpillar, serving more than 50 customers worldwide in a number of different industries," said Steve Larson, vice president of Caterpillar Inc. and chairman and president of Cat Logistics. "Given Caterpillar's increased focus on the significant growth opportunities in its core businesses, the company has decided to consider its options for the future of this business. As we work through these alternatives, we will continue to be sharply focused on delivering value for our customers," Larson added.
Caterpillar has retained B of A Merrill Lynch and Robert W. Baird & Co. to assist the company as it reviews alternatives. A final decision about the third-party logistics business is expected by the end of 2011.
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