CNH Industrial N.V. announced a definitive agreement with Kobelco Construction Machinery Co., Ltd., to establish a joint venture that will operate CNH’s construction equipment business (CE JV). Kobelco will be the majority owner of the CE JV, with CNH selling a 70 percent interest in its construction equipment business.
The CE JV will offer a portfolio spanning a broad range of earthmoving, lifting, and compaction applications across the heavy and compact segments — including excavators, loaders, graders and dozers, compact track loaders, skid steer loaders, and tractor loader backhoes — currently sold under the CASE Construction, Eurocomach, and New Holland Construction brands.
“We are adapting to changing dynamics in the construction sector and a greater pace of innovation,” said Humayan Chishti, President of CNH’s construction segment. “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.”
Chishti is expected to continue leading the business as CEO following closing.
The CE JV’s products will continue to be supported through the same global channels available today. CNH Capital will continue to support the CE JV’s customers and dealers with retail financing, leases, rental programs, and insurance products.
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“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,” said Gerrit Marx, CEO of CNH. “The CE JV will be a leader with the scale, focus, and agility to invest, accelerate innovation, and better serve global construction customers.”
The transaction values CNH’s construction equipment business at an enterprise value of $1 billion. CNH expects to receive $700 million in cash consideration for 70 percent of the business, subject to adjustments for net debt, working capital, and other customary items. CNH expects to use these net cash proceeds to reduce debt and strengthen its balance sheet.
CNH will retain a 30 percent equity ownership position in the CE JV. Each party will be subject to a three-year lock-up period. To provide continuity and facilitate a smooth business transition, CNH will continue to remain a strategic partner to the CE JV.
The joint venture will be established though the creation of two companies that will jointly operate as the CE JV. The transaction is expected to close by the end of 2027, subject to regulatory approvals and other customary closing conditions.
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The transaction continues CNH’s transformation into a pure-play agriculture equipment, technology, and services company.
Kobelco Construction Machinery Co. is a wholly owned subsidiary of Kobe Steel., Ltd.
