BEIJING (CHINA) – Italy’s CNH Industrial is in talks with China’s FAW over truckmaker Iveco, the Italian-American group said on Wednesday.
CNH Industrial’s new CEO Scott W. Wine, took office this week. A spokesman for the company confirmed that discussions are in the initial stages, regarding its Iveco business with FAW Jiefang.
“No final agreement around the scope or nature of cooperation has been reached at this time,” the spokesman said. “Further information in line with statutory and regulatory requirements will be disclosed in due course.”
It was previously reported that the state-owned Chinese company had made an initial offer of about 3 billion euros ($3.7 billion) for Iveco. Since CNH considered the valuation to be too low, the offer was declined. However, FAW has made an improved takeover offer in the latest discussions and wants to acquire all of Iveco’s commercial vehicles business, including trucks and buses, as well as a minority stake in the FPT engine division, a second source said.
Milan-listed shares in CNH extended gains after news of the talks, rising as much as 4.5% in morning trade.
The latest talks on Iveco’s future come as Changchun-based FAW, which makes heavy duty trucks under its Jiefang brand, looks to expand outside China in the next couple of years, said a source. An investment in Iveco will help FAW’s Jiefang brand to gain access to the international commercial vehicles market
CNH also held talks with Chinese industrial conglomerate Shandong Heavy Industry Group late last year, which offered at least 3.5 billion euros but has been outbid by FAW, sources said.
Separately, Iveco is in talks to jointly develop autonomous truck technologies with Chinese startup Plus, which has a tie-up with Jiefang, one of the sources said.