Back to top

Analyst Blog

Farm and construction equipment manufacturer CNH Global NV will debut on the New York Stock Exchange on Sep 30. The announcement was recently made by company's chairman Sergio Marchionne.

In Nov 2012, Fiat Industrial, the parent company of CNH Global, inked a definitive agreement to merge its businesses with the latter. The merged company will be registered under the laws of the Netherlands and will be listed on the New York Stock Exchange. However, for corporate tax purpose, it will be based in the U.K. as the region offers a lower corporate tax rate than Italy.

The strategic merger would enable Fiat Industrial to shift its base from Italy, which has been hit by four recessions since 2001. The successful integration of both the businesses would fortify the combined entity to compete at the highest level in the capital-goods sector with adequate flexibility to pursue inorganic growth at opportune times.
 
In addition, the combined company is likely to focus more on the excavator segment as CNH Global had ended its long-term alliance with Japanese company Kobe Steel, Ltd. and group company Kobelco Construction Machinery Co., Ltd. on Dec 31, 2012. Post-merger, the newly formed company would be the world’s third-largest capital-goods company with a product line spanning from Iveco delivery trucks, New Holland harvesters to FPT ship engines.

Fiat Industrial is a leading international auto manufacturing company that designs, produces and sells vehicles for the mass market under well-known brands such as Fiat, Alfa Romeo, Lancia, Abarth, the Ferrari and Maserati. It also has a strategic alliance with premier auto major, the Chrysler Group, to further expand its geographic presence.

The merger of Fiat Industrial and CNH Global is likely to sow the seeds of a similar endeavor and will serve as a “technical blueprint” for a likely merger between the former and its Chrysler division in the U.S.

Based in Amsterdam, CNH Global manufactures agricultural and construction equipment. The company primarily sells and distributes its products through its dealers and distributors spread across 170 countries. On Nov 12, 1999, CNH Global was formed following the merger of New Holland N.V. and Case Corporation.  The company has three operating segments – Agricultural Equipment, Construction Equipment, and Financial Services.

CNH Global presently has a Zacks Rank #3 (Hold). Other notable companies in the industry include Lindsay Corporation (LNN - Analyst Report) and AGCO Corporation (AGCO - Analyst Report), both carrying a Zacks Rank #2 (Buy), and Kubota Corporation , which carries a Zacks Rank #1 (Strong Buy).

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
RPC INC RES 24.91 +8.35%
LITHIA MOTO… LAD 94.59 +4.60%
DELTA AIR L… DAL 39.15 +3.90%
FLAMEL TECH… FLML 14.51 +3.50%
SOUTHWEST A… LUV 28.87 +2.92%