CNH sells 70% construction business for $1 billion

CNH (NYSE:CNH) has agreed to sell a 70% interest in its Construction Equipment business to Kobelco Construction Machinery in a transaction valuing the business at $1 billion.

The deal will give CNH $700 million in expected cash proceeds, subject to customary adjustments, while the company will retain a 30% equity stake in the joint venture.

CNH said the agreement would allow it to sharpen its focus on agriculture equipment, technology and services while improving its margins.

The transaction remains subject to regulatory approvals and other customary closing conditions, with completion expected by the end of 2027, and both parties will face a three-year lock-up period.

The joint venture will be operated through two newly created companies, while CNH Capital will remain within CNH and agricultural dealers will retain access to construction equipment supplied by the venture.

The transaction forms part of CNH's broader strategy to concentrate on its agricultural equipment business, alongside investments in technology, digital solutions and customer services.

CNH operates across agricultural and construction equipment markets, with brands including Case IH, New Holland and CASE Construction Equipment, while the proposed partnership will give Kobelco a greater ownership role in the construction business.