Raven Industries Soars on $2.1 Billion CNH Industrial Deal
Get Report shares soared on Monday, climbing nearly 50%, after CNH Industrial (CNHI) - Get Report said it has struck a deal to buy the agricultural equipment maker in a tie-up valued at $2.1 billion.
CNH will pay $58 a share for Sioux Falls, South Dakota-based Raven, a 33.6% premium to Raven’s four-week volume-weighted average stock price, giving it an enterprise value of $2.1 billion, the companies said Monday.
Owned by the billionaire Agnelli family, London-based CNH said the deal will allow it to beef up its agricultural business with precision-technology tools as the Italian-American construction equipment maker prepares to spin off its truck, bus and engine operations.
CNH said it expects $400 million of revenue synergies from the deal by 2025 and to add $150 million of earnings before interest, tax, depreciation and amortization. The Agnelli family’s Exor NV controls CNH with 42.5% of voting rights.
CNH announced plans in 2019 to split its business making agricultural equipment - with brands including Case and New Holland -- from its commercial vehicle operations in early 2021, creating two separately listed companies. The efforts were delayed by the pandemic but are now proceeding.
At last check, shares of Raven were up 49.74% at $57.83, putting them in the black for the year. Raven shares dropped 11% last week, their biggest weekly drop since March. Shares of CNH were up 1.14% at $16.38. The stock has gained nearly 30% year to date.
June 25, 2021