CAT Unit Acquires Locomotive Maker

ALBERTVILLE, Ala. (AP) -- Caterpillar Inc. said Monday its rail-services unit completed the acquisition of locomotive maker Electro-Motive Diesel for $820 million plus a post-closing adjustment estimated at $108 million.

Electro-Motive Diesel, or EMD, was made a subsidiary of Caterpillar's Progress Rail Services.

Caterpillar bought the company from private equity firms Berkshire Partners and Greenbriar Equity Group. The final deal will include a net working capital adjustment.

Progress Rail Services does work such as locomotive repairs, railcar remanufacturing and rail repair and replacement.

EMD had 2009 revenue of $1.8 billion. It makes diesel-electric locomotives for all commercial railroad uses.

Caterpillar shares rose $1.30 to $71.05 in regular trading before the announcement of the EMD completion. In extended trading, they gave back the $1.30, falling to $69.75.

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