CNH Industrial has agreed to sell a 70% interest in its Construction Equipment (CE) business to Kobelco Construction Machinery, a wholly owned subsidiary of Kobe Steel.

The two companies will form a joint venture (JV), with Kobelco holding the majority stake.

CNH will retain a 30% equity position in the new entity, which will operate CNH’s Construction Equipment business.

The agreement values CNH’s CE business at $1bn. CNH expects to receive $700m in cash as consideration for the sale, subject to adjustments related to net debt, working capital, and other customary factors.

The company intends to use the proceeds to reduce its debt and improve its balance sheet.

Completion of the transaction is targeted by the end of 2027, pending regulatory clearance and standard closing conditions.

Both parties are subject to a three-year lock-up period on their shares.

The new JV will combine CNH’s global sales and service network, established brands, and customer base with Kobelco’s technology in hydraulic excavators, cranes, and digital transformation solutions, including its K-DIVE remote operation technology.

The CE JV is expected to offer a range of products under the CASE Construction, Eurocomach, and New Holland Construction brands, covering lifting, earthmoving, and compaction applications.

CNH Construction segment president Humayun Chishti said: “This is a tremendous opportunity for our team, our dealers, and our customers. We are adapting to changing dynamics in the construction sector and a greater pace of innovation.

“Together as the CE JV, we will deliver a complementary portfolio built for long-term growth, and benefit from a stronger platform to do what we do best — build exceptional machines and deliver outstanding support to the people who rely on them every day.”

Chishti is anticipated to continue as CEO of the business after the transaction is completed.

CNH will continue to provide full-line agriculture solutions under the Case IH, STEYR, New Holland, and CNH Tech brands, including Raven precision technology.

CNH Capital will remain part of CNH and support CE JV customers and dealers with financing and insurance services.

In February 2026, New Holland Construction, part of CNH Industrial, expanded its D-Series range with five new diesel-powered mini excavators.