NEW YORK (AP) — Caterpillar Inc., the world's largest construction and mining equipment maker, said Tuesday it has received an $8.6 billion bridge loan from banks led by JPMorgan Chase & Co. which it will use to pay for its acquisition of Bucyrus International Inc.
Caterpillar last month said it would buy the Milwaukee-based maker of surface mining equipment used for coal, copper, iron ore, oil sands and other minerals for $7.6 billion. Including debt, the deal is valued at $8.6 billion.
With the Bucyrus deal, Caterpillar will expand its footprint in emerging markets where the appetite for raw materials used in construction and mining are strong. It also will significantly expand Caterpillar's line of mining equipment and double its mining revenue.
The company said in a regulatory filing that it plans to also use the loan to refinance Bucyrus debt and pay related fees. Caterpillar may issue senior debt or stock instead of using the entire bridge loan.
Under terms of the financing agreement, Caterpillar must maintain a total net worth of at least $9 billion.
Shares of Peoria, Ill.-based Caterpillar closed up $1.15 at $90.35.