Thirteen months after suspending all shipments to Russia, CNH Industrial, the parent company of Case and New Holland construction equipment and Case IH agriculture equipment, announced on April 19 that it would divest its business activities in Russia for a total consideration of approximately $60 million.
CNH was one of several construction equipment manufacturers to halt exports to or production of their products in Russia, following the countries’ invasion of Ukraine. The company took action to support Ukrainians impacted by the crisis by donating $500,000 to nongovernmental organizations providing on-the-ground assistance to those in need, as well as establishing a global employee donation fund, with a dollar-for-dollar company match.
Until March 2022, CNH operated a corporate office in the Moscow region through which it managed the import and distribution of its products, regional business activities and commercial financing.
Approximately 200 employees worked at its Russian manufacturing facilities for agricultural equipment and implements and construction equipment, and a parts depot. According to the report, up until April 19, the payment of employee salaries and other administrative expenses in Russia were honored. “We wish to acknowledge our former employees for their years of dedicated service,” CNH said.
The sale will not have a significant impact on the manufacturer, as the country generated $380 million in revenue, or 2% of CNH’s consolidated revenue in 2021, the last full year of operations.
At the end of the first quarter of 2022, CNH recorded charges of $71 million related to asset write-down, financial receivable allowances, and a valuation allowance against deferred tax assets. CNH will take additional pre-tax charges of approximately $20 million in connection with the divestitures.