Caterpillar Raises Debt in 3 Parts

Caterpillar Inc. ( CAT - Analyst Report ) sold $1 billion notes in three tranches, as reported by IFR, a Thomson Reuters service. Caterpillar appointed Citigroup Inc. ( C - Analyst Report ) and Goldman Sachs ( GS - Analyst Report ) as book running lead managers for the offer.

Caterpillar divided the sum of $1 billion into three tranches, comprising $250 million, $300 million and $450 million.

Notes amount to $250 million with a floating issue price of 100% of aggregate nominal amount. The settlement date for the issue is April 1, 2011, while the maturity is in April, 2014. The notes are non-callable on early redemption.

In the second part, Caterpillar has sold $300 million worth of notes, with a coupon rate of 1.65% and issue price of $99.988 per share. The settlement date for the issue is April 1, 2011, while the maturity is on April 1, 2014. The spread on the issue is 53 basis points more than government bonds.

The last part consisting of $450 million worth of notes, having a coupon rate of 2.65%, is due to mature on April 1, 2016. The settlement date for the issue is April 1, 2011. The spread on the issue is 65 basis points more than government bonds.

Caterpillar recently redeemed six notes issued earlier by its financial wing for a total amount of $15.15 million. The company possessed cash and cash equivalents of $3.6 billion as of December 31, 2010, and cash from operating activities of $5.0 billion for the fiscal 2010.

Peoria, Illinois-based Caterpillar Inc. is a manufacturer of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines.

Caterpillar is one of the few leading U.S. companies in an industry that competes globally from a principally domestic manufacturing base. The company operates three divisions: Machines, Engines and Financial Products. Caterpillar competes with the likes of CNH Global NV ( CNH - Snapshot Report ) , Komatsu Ltd. and Volvo AB.