Caterpillar, Inc. (NYSE:CAT) shares are trading higher on Monday after the company inked a Scheme Implementation Deed with Australia-based RPMGlobal Holdings Limited.
As per the deal, Caterpillar, or its wholly owned subsidiary, will acquire 100% of RPM’s fully diluted share capital through a Scheme of Arrangement for an equity value of 1.12 billion Australian dollars ($733 million).
RPM shareholders will receive 5.00 Australian dollars per share in cash, representing a 32.6% premium over RPM’s closing price of 3.77 Australian dollars on August 28, 2025, the last trading day before Caterpillar’s initial non-binding proposal.
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The deal consideration represents an enterprise value of 1.05 billion Australian dollars, reflecting a 32.6% premium over the last closing price of 3.77 Australian dollars per share on August 28, 2025, and a 44.2% premium to the 1-month volume-weighted average price of 3.47 Australian dollars.
The Board views the Scheme as attractive due to a 32.6% premium to the undisturbed share price, cash consideration providing certainty of value, and limited conditions, requiring only Foreign Investment Review Board (FIRB) approval and standard transaction approvals.
The RPM Board unanimously recommends shareholders vote in favor of the Scheme, assuming no Superior Proposal and the Independent Expert confirms it is in shareholders’ best interests.
The transaction is expected to be completed in the first quarter of 2026.
Denise Johnson, group president, Caterpillar Resource Industries, said, “Their software solutions complement Caterpillar’s existing technologies, especially in areas such as asset management, fleet management and autonomy. Together, we have the potential to enhance mine-site operations for our customers, unlocking even greater value.”
In August, Caterpillar said in a regulatory filing that it now expects the net impact of incremental tariffs announced in 2025 to be between $500 million and $600 million in the third quarter.
The company anticipates a total tariff-related impact of approximately $1.5 billion to $1.8 billion for 2025.
As of June 30, Caterpillar had cash and cash equivalents of $5.4 billion.
Investors can gain exposure to the stock via Global X Funds Global X Dow 30 Covered Call ETF (NYSE:DJIA) and SPDR Dow Jones Industrial Average ETF (NYSE:DIA).
Price Action: CAT shares were trading higher by 2.45% to $503.48 premarket at last check Monday.
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