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Caterpillar Inc. recently reached an agreement to acquire Progress Rail Services Inc. for $1 billion. Under the deal’s terms, Caterpillar will pay about $800 million in a combination of cash and Caterpillar stock, and assume $200 million in long-term debt.

Majority owned by JP Morgan Chase & Co. Inc. affiliate One Equity Partners, Progress Rail supplies reconditioned rail-car components, rail and other track materials, and maintenance-of-way equipment, and provides car and locomotive repair, car dismantling and rail welding services. The company — which conducted an initial public offering earlier this year — operates more than 90 facilities in the United States, Canada and Mexico.

“The rail aftermarket services business is a strong fit with our strategic direction and will leverage our remanufacturing capability,” said Caterpillar Chairman and Chief Executive Officer Jim Owens in a prepared statement.

Progress Rail President and CEO William Ainsworth and the supplier’s senior management team will join Caterpillar. Subject to regulatory approvals, the transaction is expected to close by the end of the second quarter.