A Dream Marriage Turns Nightmarish

It seemed like such a smart pairing. In early 1988, Komatsu Ltd. of Japan and Dallas-based Dresser Industries Inc. merged their construction equipment manufacturing and engineering facilities in the U. S., Latin America, and Canada. The joint venture certainly had a compelling logic to it: A struggling Dresser needed a rich partner to help overhaul its aging factories. Komatsu, meanwhile, wanted to make a foray into the home turf of market leader Caterpillar Inc. The merger vaulted Komatsu Dresser Co. into the No. 2 slot in the $10 billion U. S. market for big bulldozers, tractors, and excavators.

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