kscarbel2 Posted August 29, 2019 Share Posted August 29, 2019 Transport Topics / August 29, 2019 CNH Industrial NV, the tractor maker backed by Italy’s billionaire Agnelli family, is evaluating options for its Iveco truck business as it seeks ways to unlock value, people familiar with the matter said. The company is weighing possibilities including spinning off the Iveco division or combining it with a competitor, according to the people, who asked not to be identified because the information is private. It could announce a strategic review of the business as soon as next week, when the company is holding an investor meeting, the people said. CNH, which was once part of carmaker Fiat Chrysler Automobiles NV, makes farm equipment under brands like Case and New Holland. The possibility of separating the truck business from the company’s more profitable tractor division has long been mooted, with then-CEO Richard Tobin saying last year he would consider spinning off Iveco after further strengthening CNH’s balance sheet. No final decisions have been made, and there’s no certainty the deliberations will lead to a transaction, the people said. A representative for CNH declined to comment. CNH’s agricultural business, by far its biggest unit, boasts profit margins that are more than triple those of the trucks operation. The overall company’s valuation also trails its peers in the farm machinery industry, trading at an enterprise value of 5.8 times this year’s estimated earnings before interest, tax, depreciation and amortization. Deere & Co., which only makes agricultural equipment, trades at a multiple of 11.7 times, data compiled by Bloomberg show. Tobin was a close aide of Fiat Chrysler’s former CEO, the late Sergio Marchionne, who long championed separating businesses to help drive more value for shareholders. The strategy increased the value of the Fiat empire more than tenfold during his tenure, helped by spinoffs of Fiat Industrial SpA, which later became CNH, and super-car maker Ferrari NV. Tobin left CNH in April and has since become CEO of U.S. industrial manufacturer Dover Corp. He was succeeded by Hubertus Muehlhaeuser, a former vice president of AGCO Corp. and CEO of Welbilt Inc. The new CEO said at an annual shareholder meeting in April the company was “doing a portfolio review of its assets but considers all business core.” . Quote Link to comment Share on other sites More sharing options...
Red Horse Posted August 30, 2019 Share Posted August 30, 2019 2 hours ago, kscarbel2 said: Transport Topics / August 29, 2019 CNH Industrial NV, the tractor maker backed by Italy’s billionaire Agnelli family, is evaluating options for its Iveco truck business as it seeks ways to unlock value, people familiar with the matter said. The company is weighing possibilities including spinning off the Iveco division or combining it with a competitor, according to the people, who asked not to be identified because the information is private. It could announce a strategic review of the business as soon as next week, when the company is holding an investor meeting, the people said. CNH, which was once part of carmaker Fiat Chrysler Automobiles NV, makes farm equipment under brands like Case and New Holland. The possibility of separating the truck business from the company’s more profitable tractor division has long been mooted, with then-CEO Richard Tobin saying last year he would consider spinning off Iveco after further strengthening CNH’s balance sheet. No final decisions have been made, and there’s no certainty the deliberations will lead to a transaction, the people said. A representative for CNH declined to comment. CNH’s agricultural business, by far its biggest unit, boasts profit margins that are more than triple those of the trucks operation. The overall company’s valuation also trails its peers in the farm machinery industry, trading at an enterprise value of 5.8 times this year’s estimated earnings before interest, tax, depreciation and amortization. Deere & Co., which only makes agricultural equipment, trades at a multiple of 11.7 times, data compiled by Bloomberg show. Tobin was a close aide of Fiat Chrysler’s former CEO, the late Sergio Marchionne, who long championed separating businesses to help drive more value for shareholders. The strategy increased the value of the Fiat empire more than tenfold during his tenure, helped by spinoffs of Fiat Industrial SpA, which later became CNH, and super-car maker Ferrari NV. Tobin left CNH in April and has since become CEO of U.S. industrial manufacturer Dover Corp. He was succeeded by Hubertus Muehlhaeuser, a former vice president of AGCO Corp. and CEO of Welbilt Inc. The new CEO said at an annual shareholder meeting in April the company was “doing a portfolio review of its assets but considers all business core.” . Kevin point of info, not sure of how it breaks out but Case and Deere are very big players in construction equipment. NH to a much lesser degree. My bet would be Case construction sales are greater than the "red tractor" business. As for Deere, on a world wide basis "green" equipment probably outsells "yellow" but not by much. Who would you see as a likely partner for Iveco? Quote Link to comment Share on other sites More sharing options...
kscarbel2 Posted August 30, 2019 Author Share Posted August 30, 2019 12 hours ago, Red Horse said: Kevin point of info, not sure of how it breaks out but Case and Deere are very big players in construction equipment. NH to a much lesser degree. My bet would be Case construction sales are greater than the "red tractor" business. As for Deere, on a world wide basis "green" equipment probably outsells "yellow" but not by much. Who would you see as a likely partner for Iveco? The only possibility I can imagine is a Chinese partner. They already have a JV with Hongyan but need a better partner than that. My heart wanted FCA to bring back Dodge medium and heavy. And both Autocar and the Ford F-650/750 brands are proof that small truckmakers can exist (Ford medium is realistically a singular brand). 1 Quote Link to comment Share on other sites More sharing options...
Hayseed Posted August 30, 2019 Share Posted August 30, 2019 My 2 cents worth is.. IVECO should've beat VW to the punch in Buying a stake in Navistar...(would been a sentimental reunion) But Now I reckon IVECO will wither away to nothing over the next 10 or so years..If not sooner Quote "Be who you are and say what you feel...Because those that matter...don't mind...And those that mind....don't matter." - Link to comment Share on other sites More sharing options...
Bullheaded Posted September 4, 2019 Share Posted September 4, 2019 Update to this story. https://www.equipmentworld.com/cnh-to-separate-off-and-on-highway-business-into-two-companies/?utm_source=daily&utm_medium=email&utm_content=09-03-2019&utm_campaign=Equipment World&ust_id=f1576ceb10f1d6560c2b88c4de3ca180 1 Quote Link to comment Share on other sites More sharing options...
Hayseed Posted September 5, 2019 Share Posted September 5, 2019 This could be a very shrewd Move by CNH.. https://www.fullyloaded.com.au/product-news/1909/nikola-gains-huge-cnh-investment-injection Quote "Be who you are and say what you feel...Because those that matter...don't mind...And those that mind....don't matter." - Link to comment Share on other sites More sharing options...
Bullheaded Posted September 6, 2019 Share Posted September 6, 2019 https://www.equipmentworld.com/cnh-to-eliminate-44-construction-models-by-2022-in-on-off-highway-split/?utm_source=daily&utm_medium=email&utm_content=09-05-2019&utm_campaign=Equipment World&ust_id=f1576ceb10f1d6560c2b88c4de3ca180 2 Quote Link to comment Share on other sites More sharing options...
Maxidyne Posted September 6, 2019 Share Posted September 6, 2019 I'm sure the dealers will be none too happy hearing that 20% of them won't be dealers anymore. But as consolation, they get to be dealers for Nicola trucks if they ever appear out of the vaporware... 1 Quote Link to comment Share on other sites More sharing options...
RoadwayR Posted September 6, 2019 Share Posted September 6, 2019 Just now, RoadwayR said: Spurned Case equipment dealers will most assuredly take on Komatsu, Doosan, or one of the new Chinese manufacturers like LuiGong or Sany. This will eventually bite CNH in the behind. The company I work for used to be a big Case buyer. Reasonably priced simple rugged equipment that was easy to service and repair, with inexpensive replacement parts. In recent years our experience has been that Case equipment has become expensive, overly complex, and not as reliable. This has been very apparent in skid-steers. We switched from 'power tan' to a particular shade of yellow, if you know what I mean. Still, I miss the old 60XT's and 580M's. If you are going to pay Caterpillar prices, why not buy the Caterpillar? Quote Link to comment Share on other sites More sharing options...
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