Caterpillar Faces In-Depth EU Probe Into Plan to Buy MWM

Caterpillar Inc. (CAT), the world’s largest maker of construction and mining equipment, faces an in- depth European Union probe into its plan to buy MWM Holding GmbH from 3i Group Plc, amid concerns the deal may harm competition for so-called gas-fueled gensets.

“The proposed acquisition would remove a strong competitor from the market,” EU Competition Commissioner Joaquin Almunia, said in an e-mailed statement today from Brussels. The European Commission set a deadline of Sept. 16 to rule on the deal.

Caterpillar said in October it agreed to buy the Mannheim, Germany-based manufacturer of combustion engines for 580 million euros ($847 million). MWM would become part of Caterpillar’s electric power division, which supplies natural gas and diesel generator sets and integrated power systems.

Earlier today, Caterpillar won approval from the EU to buy Bucyrus International Inc. (BUCY) in a transaction valued at $8.6 billion including debt. The Bucyrus deal, which adds shovels and drills to Caterpillar’s range of mining machinery, won’t hurt competition in the 27-nation EU, the commission said.

The in-depth probe into the MWM purchase is “not unusual nor unexpected and is part of the process,” Jim Dugan, a spokesman for Peoria, Illinois-based Caterpillar, said in an e- mailed statement. “We look forward to closing sometime in mid- 2011.”

Gensets combine a reciprocating engine with a generator and other ancillary equipment, and are used for power generation, the commission said in the statement.

To contact the reporters on this story: Jim Brunsden in Brussels at

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net;