Caterpillar Inc. last week signed an agreement to acquire MWM Holding GmbH from 3i and funds managed by 3i. Headquartered in Mannheim, Germany, MWM is a global supplier of highly sustainable alternative engines.

With the acquisition of MWM, which stands for Motoren-Werke Mannheim, Caterpillar will significantly expand customer options for sustainable power generation solutions. The total transaction value amounts to €580 million (about U.S. $810 million) and will be paid in cash.

"MWM is recognized for its leading technology and product strength, particularly for its highly efficient range of engines, combined heat and power and trigeneration solutions capable of operating on a wide range of gaseous fuels including natural gas, biogas, mine gas and industrial waste gas," said Caterpillar CEO Doug Oberhelman. "This is a natural complement to Caterpillar's existing diesel and gas power generation business and demonstrates our commitment to continued investment in sustainable products and industries," Oberhelman added.

"We are very pleased about the development MWM experienced over the last three years,” said Peter Wirtz, partner and managing director of 3i Germany. “In close collaboration with the MWM management and its employees, we developed and implemented a broad number of strategic and operational improvement initiatives. We also made significant investments in the company's production facilities, research and development platform and distribution network. Beyond our accomplished mission of transforming MWM's positioning, we strongly believe in the long-term success of the company under Caterpillar's ownership."

MWM will become part of Caterpillar's Electric Power Division, which supplies natural gas and diesel generator sets and integrated power systems involved in the generation, control and supply of electricity. EPD operates in more than 50 locations around the world.

"The gas engines industry is a great fit for Caterpillar's energy and electric power systems business,” said Bill Rohner, Caterpillar vice president with responsibility for Electric Power. “Together with the two companies' premium products, technology and global distribution network, our comprehensive offerings will deliver sustainable power system solutions for our global customers."

The acquisition is expected to close in the coming months, pending final regulatory approvals.

3i is an international investor focused on private equity, infrastructure and debt management, investing in Europe, Asia and North America.