Snap-on terminates joint venture

Snap-on Inc., a Kenosha-based innovator, manufacturer and marketer of tools, diagnostics, equipment, software and service solutions for professional users, announced that it has notified CIT of termination of the operating agreement between CIT and Snap-on relating to the parties’ Snap-on Credit LLC joint venture.
Snap-on and CIT are partners in Snap-on Credit LLC, which provides a broad range of financial services to Snap-on’s U.S. franchisees and customers. The joint venture was established in 1999 and CIT has been the exclusive purchaser of the financing contracts originated by Snap-on Credit. Snap-on and CIT have been in ongoing discussions concerning a longer-term new joint venture agreement. Both parties have agreed to continue the discussions.
As a consequence of the termination, Snap-on will acquire CIT’s interest in the joint venture for approximately $8.2 million, Snap-on Credit will become a wholly owned subsidiary of Snap-on Inc., and Snap-on Credit will continue to service the existing portfolio of contracts owned by CIT. The approximate outstanding balance of this portfolio is $834 million. Snap-on has no obligation to purchase the existing portfolio of contracts owned by CIT.