CNH Committee Recommends Fiat Merger Plan

By CnAgri Print

The special committee of the board of directors of CNH Global N.V. announced that it has recommended the merger agreement entered into between CNH and Fiat Industrial S.p.A.

As part of the plan, FI and CNH will merge into a newly-formed company organized in the Netherlands. CNH shareholders will receive 3.828 NewCo shares for each CNH share and FI shareholders will receive one NewCo share for each FI share.

CNH shareholders will also receive a special cash dividend of $10 per CNH share to be paid to CNH shareholders prior to December 31, 2012, to the extent possible, and in any event prior to the closing of the merger; the special cash dividend to be received by FI on its 88% of the CNH shares will be deferred and paid only in the event that the merger agreement is terminated.

The committee says it gave careful consideration to the enhanced offer submitted by FI on November 19 and determined that the terms are fair and in the best interest of CNH and its stakeholders.

Resulting in the formation of one of the largest capital goods companies in the world, the combination will have a number of industrial and operational benefits for CNH and its stakeholders. These include the ability to more effectively utilize the financial services and treasury operations of the broader group and achieve greater scale in emerging markets as well as guaranteeing access to a stable supply of engine know-how and industrial capabilities.

In addition, the combination is anticipated to enhance the appeal of the broader group in the capital markets and to result in greater clarity and liquidity for investors.

The transaction is expected to be completed in the second quarter of 2013, subject to customary regulatory approvals and limited closing conditions.