Caterpillar and Ariel announce 50-50 JV--Black Horse--aimed at providing well service pressure pumping products for customers in global oil and gas industry; JV also announces acquisition of Houston-based pump manufacturer ProSource
PEORIA, Illinois and MOUNT VERNON, Ohio
December 5, 2012
– Caterpillar Inc. (NYSE: CAT) and Ariel Corporation announced today the formation of a 50-50 joint venture that will provide well service pressure pumping products for customers in the global oil and gas industry. The combined venture, Black Horse LLC, also announced the acquisition of pump manufacturer ProSource of Houston, Texas.
Caterpillar is the world's leading manufacturer of diesel and natural gas engines for the generation, control and supply of mechanical and electric power for the marine and petroleum industries. Ariel Corporation is a global leader in the design and manufacture of gas compressors. More than 40,000 Ariel compressors are currently in use throughout the global energy industry to extract, process, transport, store and distribute natural gas from the wellhead to the end-user.
The acquisition of ProSource, which designs and manufactures reciprocating pressure pumps, enables Black Horse LLC to serve the well service market. Black Horse LLC will leverage Caterpillar and Ariel engineering and manufacturing expertise to expand ProSource's existing product line to better serve global oil and gas customers. Frac pumps sold through the combined venture will be branded and sold under the Cat name and distributed through the Cat dealer network.
"We are thrilled to partner with Ariel to bring our petroleum customers not just a partial solution, but a complete package," said Tom Frake, Caterpillar vice president with responsibility for Marine and Petroleum Power. "Together, with the support of our Cat dealer network, we can provide not only a complete pressure-pumping solution, but also the global parts and service support to maximize up-time throughout the world. This deal significantly improves our capability to meet our oil and gas customers' needs for reliable, sustainable power."
Under the arrangement, executives from Caterpillar's Marine and Petroleum Power Division and Ariel Corporation will jointly lead Black Horse LLC.
"Ariel has built an outstanding reputation by employing technology to provide high-quality, innovative products backed by world-class customer support. Caterpillar has done exactly the same," said Karen Buchwald Wright, Ariel's president and chief executive officer. "This partnership brings together two companies with the same strong values and commitment to customers' success. It's an exciting, new chapter for both of us."
The joint venture and integration of ProSource will result in important synergies, including leveraging the companies' existing product ranges, advanced technologies, research and development resources, and manufacturing, distribution and customer support capabilities.
Black Horse LLC is headquartered in Houston, Texas.
For more than 85 years, Caterpillar Inc. has been making sustainable progress possible and driving positive change on every continent. With 2011 sales and revenues of $60.138 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The company also is a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services and Progress Rail Services. More information is available at: http://www.caterpillar.com.
Established in 1966, and headquartered in Mount Vernon, OH, Ariel Corporation is the world's largest manufacturer of separable reciprocating gas compressors utilized by the global energy industry to extract, process, transport, store, and distribute natural gas from the wellhead to the end-user. Ariel also produces specialized API-618 reciprocating compressors for the process industry. As a world-class manufacturer, Ariel sets the industry standard through industry-leading research & development, expert design & manufacturing, and unmatched customer support. More information is available at: http://www.ArielCorp.com.