Caterpillar Moving Headquarters to Chicago -- Update

By Andrew Tangel and Shibani Mahtani 

Caterpillar Inc. is moving its headquarters to the Chicago area, the latest U.S. company to say they are gravitating toward the Windy City in search of talent and better travel connections.

The equipment maker will join McDonald's Corp., agribusiness giant Archer Daniels Midland Co. and other companies that have moved to Chicago and its suburbs in recent years. Like many of those companies, Caterpillar said moving a relatively small office for its top leaders to the country's third biggest city would make it easier to recruit new executives and travel between the company's global operations.

"Locating our headquarters closer to a global transportation hub, such as Chicago, means we can meet with our global customers, dealers and employees more easily and frequently," said Caterpillar Chief Executive Jim Umpleby.

Caterpillar expects about 300 employees to be based in the new Chicago office, including some from the company's longtime home in Peoria, Ill. Caterpillar said that means it will scrap plans to build a new headquarters complex there, though about 12,000 employees will remain in its current offices.

"Peoria will continue to be our hometown," Mr. Umpleby said.

It wasn't clear whether Caterpillar's new office will be in Chicago itself or a suburb. A spokeswoman said the company hadn't settled on an office lease. She said the company hadn't discussed tax incentives with city officials, a sweetener that often entices companies to relocate.

Last June, McDonald's said it would move from its longtime home in the suburbs to a nine-story building in Chicago's West Loop neighborhood. The new headquarters including a staff training facility are scheduled to open in 2018.

Chicago Mayor Rahm Emanuel said in January that a 224,000-square-foot shopping center would be built close to McDonald's new headquarters. The city expects the project to create 960 permanent jobs and 140 construction jobs.

Communications and software company Motorola Solutions also moved its headquarters to downtown Chicago last year from the suburb of Schaumburg. Chairman and Chief Executive Greg Brown said the move has put Motorola in the orbit of young workers and graduates from the city's universities.

--Anne Steele contributed to this article.

Write to Andrew Tangel at [e-mail] and Shibani Mahtani at [e-mail]

(END) Dow Jones Newswires

January 31, 2017 15:28 ET (20:28 GMT)

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