Fiat to merge brands with Case-New Holland

Fiat Industrial S.p.A. and CNH Global N.V. announced they have entered into a definitive merger agreement to combine the businesses of Fiat Industrial and CNH, creating a new company that so far is being called NewCo.

Fiat Industrial owns all but 12 percent of the stock in CNH Global. The merger forms a single company from CNH and Fiat, its majority owner.

CNH Global operates a Case IH tractor plant in Racine. It also has offices there that serve as the headquarters for the Case IH and Case Construction brands.

The NewCo name is a stand-in for a new name yet to be announced. Fiat Industrial chairman Sergio Marchionne said the merger agreement ends a lengthy process of simplifying the group’s equity capital structure and allows shareholders in both companies the opportunity to “participate in the growth prospects of the world’s third-largest capital goods provider.”

NewCo is being organized under the laws of the Netherlands, and its shares will be listed on the New York Stock Exchange.

Fiat Industrial shareholders will receive one NewCo share for each Fiat Industrial share and CNH shareholders will receive 3.828 NewCo shares for each CNH share in the merger.
The merger is subject to approval by the shareholders of Fiat Industrial and CNH.

Fiat Industrial designs and produces agricultural and construction equipment, trucks, commercial vehicles, buses and specialty vehicles in addition to engines and transmissions for those vehicles and for marine uses.

Marchionne said, “We are pleased to have reached agreement on the basis of Fiat Industrial’s improved proposal for the merger. Completion of this merger will bring to a conclusion a lengthy process of simplifying and rationalizing the Group’s equity capital structure and allow shareholders in both companies the opportunity to participate in the growth prospects of the world’s third largest capital goods provider, which will be a true peer in scale and capital markets appeal to the other major global capital goods companies. This appeal will be further enhanced through the loyalty share structure intended to reward long-term stable shareholders that share our goal of enhancing shareholder value over the long term, as well as through enhanced flexibility to pursue strategic opportunities.”

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