CNH Industrial N.V. has entered into a definitive agreement with KOBELCO Construction Machinery Co., Ltd., a wholly owned subsidiary of Kobe Steel, Ltd., to create a new joint venture that will operate CNH’s Construction Equipment business (CE JV). KOBELCO will be the majority owner of CE JV, which includes equipment currently sold under the CASE Construction Equipment, New Holland Construction, and Eurocomach brands.
The transaction values CNH’s Construction Equipment business at an enterprise value of $1 billion, and CNH expects to receive $700 million in cash consideration for 70 percent of the business, subject to adjustments. CNH will retain a 30 percent equity ownership position and will continue to remain a strategic partner to the CE JV. The transaction is expected to close by the end of 2027.
CNH Industrial to focus on agriculture equipment and technology
The agreement will advance CNH’s transition to focus fully on equipment, technology, and services for agriculture, which began with the acquisition of Raven Industries in 2021 and the separation of the on-highway commercial vehicles business through the spin-off of Iveco Group in 2022.
At closing, CNH will continue to provide full-line agriculture applications through the Case IH, New Holland, STEYR, and CNH Tech brands, including the Raven precision technology platform. CNH agriculture dealers will continue to access a suite of construction equipment machines supplied by the CE JV. CNH Capital will remain part of CNH. The transaction is expected to be accretive to CNH’s margins.
“We are confident that this is the right next step for CNH, our dealers, customers, and colleagues,” said Gerrit Marx, CNH’s chief executive officer. “As the agriculture industry moves toward recovery, this transaction strengthens CNH’s ability to invest in the products and technologies that matter most to farmers. At the same time, by creating a stronger construction equipment player, both CNH and CE JV dealers, along with their customers, will benefit from a suite of high-quality, cost-competitive construction machines that incorporate leading technology.”
Marx continued, “We undertook a comprehensive process to evaluate how best to position our Construction Equipment business, and it was clear that KOBELCO is the right long-term steward, and that our joint venture approach will ensure a smooth transition for the business and our team members who support it. The CE JV will be a leader with the scale, focus, and agility to invest, accelerate innovation, and better serve global construction customers.”
CE JV to offer comprehensive portfolio of CNH Construction Equipment solutions
This transaction combines CNH’s Construction Equipment brands, product portfolio, global sales and service network, and strong customer base with KOBELCO’s technological capabilities and product strengths in hydraulic excavators, cranes, and construction DX (digital transformation) solutions, including K-DIVE remote operation technology. The complementary geographic footprints of CNH’s Construction Equipment business and KOBELCO will establish a stronger global platform for continued growth.
Humayun Chishti, president of CNH’s Construction segment, said, “This is a tremendous opportunity for our team, our dealers, and our customers. We are adapting to changing dynamics in the construction sector and a greater pace of innovation. KOBELCO is the ideal partner — a global excavator and crane specialist with leading technology, including K-DIVE remote operation technology. Together as the CE JV, we will deliver a complementary portfolio built for long-term growth and benefit from a stronger platform to do what we do best — build exceptional machines and deliver outstanding support to the people who rely on them every day.”
Chishti is expected to continue leading the business as CEO following the closing.
The CE JV will offer a comprehensive portfolio spanning a broad range of earthmoving, lifting, and compaction applications across the heavy and compact segments — including excavators, loaders, graders, dozers, compact track loaders, skid-steer loaders, and tractor loader backhoes — currently sold under the CASE Construction Equipment, Eurocomach, and New Holland Construction brands. Service and support will continue to be available to customers worldwide through existing channels. CNH Capital will continue to support the CE JV’s customers and dealers with a full range of retail financing, leases, rental programs, and insurance products.
Read the full article here
