Caterpillar Inc said it remained in talks with interested parties over a potential sale of its third-party logistics business, but several factors including the global economic environment have caused delays in reaching a deal.

Concerns over economic growth are weighing on the prospects of U.S. companies. The Federal Reserve pointed to turmoil in Europe, driven by the euro zone's sovereign debt crisis, as a big risk to the U.S. economy.

Caterpillar said it would not have a decision on the strategic review of its logistics business before the end of the year as it had previously stated. It is hopeful that a decision can be reached in the first quarter of 2012 given the current market and business trends, Caterpillar said in a statement to Reuters.

"This is not surprising given the market volatility. Caterpillar is not under pressure to sell. The unit is non-core and they may divest it eventually, but under terms they deem right," Longbow Research analyst Eli Lustgarten said.

In March, Caterpillar said it would examine a range of options for its third-party logistics business including a potential sale, and hired Bank of America said it would examine a range of options for its third-party logistics business including a potential sale, and hired Merrill Lynch and Robert W. Baird & Co to advise on the process.

Private equity firms TPG Capital, Centerbridge Partners and BC Partners were the final suitors left in the running for the logistics business, which could fetch more than $1 billion, people familiar with the matter have said.

Two sources said Caterpillar's final negotiations focused on TPG Capital as the buyer, but cautioned that there was no certainty that a deal would be reached. TPG and Centerbridge declined to comment while BC Partners did not respond to a request for comment.

Acquistions

The Peoria, Illinois, maker of heavy machinery has recently made major acquisitions, including the $8.8 billion purchase of Bucyrus International, a major mining company.

Caterpillar's President Stu Levenick told the Reuters Global Manufacturing & Transportation Summit on Monday that the company's balance sheet could handle more acquisitions if the right opportunity presented itself.

The fact that Caterpillar's own sale process has been hit by financial market woes highlights how macroeconomic uncertainty is casting a long shadow over the plans of companies to divest assets.

Mergers and acquisition activity slowed down throughout the year as financing conditions became more challenging. Deals in the U.S. totalled $160.2 billion in the fourth quarter of 2011, down every quarter since the first quarter of 2011, when they amounted to $368.2 billion.

The third-party logistics unit -- part of Caterpillar's wholly owned subsidiary, Caterpillar Logistics Services Inc -- was formed 24 years ago in response to requests from other companies that wanted to use Caterpillar to ship parts all over the world. (Reuters)