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.July 14, 2004
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This Week:

• Chrysler Group's HEMI® Engine Is No Dog, But There IS a HEMIDOG

• Kalos Wins Again in Korean Design Survey

• Fhi and Saab Continue Partnership with New "Cross-Over" Vehicle Alliance

• MINI Brand Is Tops For Overall Satisfaction

• Blythe To Retire From Ford Chief Strategy Post; Will Remain An Outside Advisor To Bill Ford

• The new Mercedes-Benz CLS 55 AMG

• Volkswagen taps into Iranian market

• Caterpillar Logistics Services and Phoenix Venture Holdings Agree to Sale of MG Rover's Parts Business

• Nissan to Begin Construction of High-Speed Circuit in Hokkaido

• Porsche on course to another record year

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Caterpillar Logistics Services and Phoenix Venture Holdings Agree to Sale of MG Rover's Parts Business
 

DESFORD and LONGBRIDGE, United Kingdom - Caterpillar Logistics Services (UK) Limited ("Cat Logistics"), a wholly owned subsidiary of Caterpillar Inc. (NYSE:CAT) , and Phoenix Venture Holdings Limited ("PVH") are pleased to announce that they have reached an agreement for Cat Logistics to acquire the parts business of U.K. auto manufacturer, MG Rover, a wholly owned subsidiary of PVH. The value of the transaction is in excess of 100 million GBP, with an ongoing profit sharing agreement. Cat Logistics will acquire MG Rover's parts business, which includes the sourcing, marketing, distribution and sale of automotive service parts and accessories to MG Rover dealers, distributors, importers and other related customers worldwide. Since 2001, Cat Logistics has managed these activities on behalf of MG Rover from its base in Desford, Leicestershire, UK. Cat Logistics currently supports an existing MG Rover vehicle population of more than 2.5 million.

In accordance with the terms of the acquisition agreement, PVH has an option to buy back MG Rover's parts business in four to five years.

"The acquisition of MG Rover's parts business represents an attractive investment, while Cat Logistics is allowed to develop the best-in-class services it provides to the many MG Rover dealers, distributors, and importers worldwide," said Mary Bell, Chairman & President of Caterpillar Logistics, "We have long valued our relationship with the MG Rover Group and Phoenix Venture Holdings, and our organization in Desford has considerable expertise in the purchasing, marketing and distribution of MG Rover aftermarket parts."

Peter Beale, Deputy Chairman of Phoenix Venture Holdings said, "This deal provides valuable resources which will be invested in our core business, the MG Rover Group ahead of the strategic relationship with Shanghai Automotive taking effect. With experience and capability built up over many years Cat Logistics is extremely well placed to continue to provide best in class service to MG Rover dealers, distributors and importers worldwide."

Completion of this agreement is subject to regulatory approval. Current operations at the Cat Logistics Desford, UK MG Rover parts distribution facility will continue, with all 390 employees remaining with Cat Logistics, and all current employees of MG Rover's parts business provided with the opportunity to transition to Cat Logistics.

(July 9, 2004)