CNH INDUSTRIAL RESTRUCTURES: IVECO TO BECOME SEPARATE LISTED COMPANY
‘Transform 2 Win’ is the new strategy from CNH Industrial with the aim to reduce operating costs and increase the efficiency of its asset base through targeted restructuring. The ‘Transform 2 Win’ plan will see the companies ‘On-Highway’, including Iveco, Iveco Bus, Heuliez Bus and ‘OffHighway’, agriculture, separated from CNH Industrial and transferred into two listed entities. Full implementation is expected by the end of 2022.
This new five-year 2020–2024 business plan ‘Transform 2 Win’ should result in a growth in net sales by 5% and create shareholders value, as CNH Industrial stated at its Capital Markets Day event in New York, USA. “The bold plan will lead to the creation of two new global leaders in their respective fields,” said Suzanne Heywood, Chairperson, CNH Industrial.
The newly listed ‘On-Highway’ company, with 2018 pro-forma industrial activities revenues of $13.1 billion, will comprise the Iveco, Iveco Bus and Heuliez Bus (69% of revenue), together with the FPT Industrial powertrain business (31% of revenue). FPT Industrial will continue to offer industry-leading powertrain solutions and will remain a key supplier to the ‘Off-Highway’ business through a long-term supply agreement.
The spin-off of the ‘On-Highway’ assets will according to CNH Industrial, maximize management focus and flexibility, align investment priorities and incentives, better meet respective business needs and optimize the cost and capital structure of each company to drive profitable growth. The Board of Directors believes it will better position them to achieve their ambitious plan targets as well as optimize their shareholder value creation potential.
The ‘Off-Highway’ company, with 2018 pro-forma industrial activities revenues of $15.6 billion, will be predominantly an agriculture company (75% of revenue) supported by the construction business (19% of revenue). Specialty vehicles (6% of revenue) will remain within the ‘Off-Highway’ company including defense vehicles and Magirus firefighting.
Materials presented at the Capital Markets Day can be accessed from the Investor Relations section of the CNH Industrial corporate website.