CNH Industrial to Split in Two
Industrial vehicle producer CNH Industrial NV plans to split in two in a bid to hike value, Reuters reports.
CNH, formerly Fiat SpA’s Fiat Industrial commercial truck unit, was created in 2011 when Fiat Industrial was spun and then merged with U.S. agricultural equipment maker Case New Holland six years ago.
The split, which largely unwinds that deal, is expected to be completed by early 2021 and fully implemented by the end of 2022. The plan will create one company to run agricultural and construction equipment businesses. A second and separately listed unit would manage CNH’s Iveco, Heuliez and FPT powertrain operations.
Italian holding company Exor, which controls Fiat Chrysler Automobiles and Ferrari, says it will continue to hold stakes in the two new CNH entities.
Analysts tell Reuters the scheme should improve market value for CNH’s high-margin agricultural operations (with sales of $15.6 billion). At the same time, the move is expected to make CNH’s on-road truck business (sales of $13.1 billion) more attractive to investors.
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