Caterpillar starts internationalization through Brazil
Valor Econômico - 06/25/2008
The division of railroad services of the American group Caterpillar gave, yesterday, its first step outside North America, when it announced the acquisition of Brazilian MGE Equipamentos & Serviços, specialized in the production and reform of locomotives and wagons, as well as in the manufacturing of traction engines. With the deal, whose value was not revealed, the American group starts up the strategy for the internationalization of its area of railroad services. Until then, the company only had units in the United States, Canada, and Mexico. MGE's CEO Carlos Roso told Valor that Caterpillar's idea is to use the unit of the Brazilian company, in Diadema (SP) and Hortolândia (SP), as receptors for used locomotives, for the subsequent rent or lease to companies in South America. According to him, Caterpillar already sent nearly 75 used machines in the last years. Roso also affirmed that MGE will be subordinated to the railroad division of Caterpillar, and it will keep its name and management. Last year, MGE had revenues close to US$ 30 million and expects US$ 39 million for 2008, a 30% increase. "Nearly 60% of the result refers to services of maintenance and reform", informed Roso. Among MGE's main clients are: the São Paulo Metropolitan Train Company (Companhia Paulista de Trens Metropolitanos) (CPTM), the Subway of Brasília (Metrô de Brasília) and national logistics operators. In an announcement made by Caterpillar's Vice-President, Billy Ainsworth said that the acquisition of MGE is an important step for the strategy of growth of the railroad division in the international market". Currently, this area of Caterpillar, established in Alabama (USA), operates in more than 110 localities and has 4,625 employees in the United States, Mexico, and Canada.