Cat, Navistar settle lawsuits; ink long-term supply deals

PEORIA, Ill. — Enginemaker Caterpillar Inc. and its customer Navistar International have called a truce.

The two companies have settled various pending lawsuits dating back to 2001 and have agreed to a series of long-term licensing and supply agreements that are expected to increase business opportunities for both businesses. Financial terms of the agreement are not being disclosed.

The legal disputes between Caterpillar and Navistar — which makes International brand trucks — revolve around a variety of ongoing patent and pricing issues.

As part of the litigation settlement, Caterpillar will receive an up-front cash payment and a three-year promissory note from Navistar — resulting in an after-tax charge to Cat of about $50 million.

“Navistar is a very important customer to Caterpillar, and I’m pleased we’re able to settle our differences and move forward in a positive way,” said Caterpillar Chairman and CEO Jim Owens. “This agreement provides a solid foundation for a continued long-term business relationship that benefits us both.”

The long-term supply agreements affect highway truck engines, fuel injectors and remanufacturing services. As part of the deal, Caterpillar Remanufacturing will act as International’s lead global remanufacturing service provider.

“This opportunity is a natural extension to the remanufacturing program that we offer today for Cat branded truck engines,” said Steve Fisher, Caterpillar vice-president with responsibility for remanufacturing. “We look forward to the opportunity to support International’s initiative to increase truck value by offering a world-class remanufactured products program.”


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