Caterpillar has agreed to sell its distribution and support business, formerly operated by Bucyrus in Australia, to its equipment dealer WesTrac.
Westrac, a wholly owned subsidiary of Seven Group Holdings (SGH) and Caterpillar, will acquire the business in a transaction valued at $400m.
Following the deal's closure, the firm will provide sales, service and support to the former Bucyrus mining products in Western Australia, Australian Capital Territory and New South Wales.
The transaction is scheduled to close by 30 June 2012 and SGH will arrange funds through a new five-year debt facility.
According to WesTrac estimates, the Bucyrus distribution and support business is expected to generate revenues of up to A$650m ($679.3m) in 2013.
WesTrac is also expected to take over approximately 430 former Bucyrus employees and contractors at Western Australia and New South Wales facilities.
WesTrac Group chief executive Jim Walker said, "The Bucyrus product line and large installed base are a logical addition to our current range of Cat products, and will provide us with significant opportunities for future growth with our mining customers."
Caterpillar group president Steve Wunning added, "We are pleased to announce this agreement with WesTrac today as we continue to make excellent progress in the transition of the product distribution and support of former Bucyrus machinery to Cat dealers around the world."
Image: WesTrac is one of the largest Caterpillar dealers in the world. Photo: AlfvanBeem.