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Iveco shares skid on debut after spin-off from CNH Industrial

Iveco shares skid on debut after spin-off from CNH Industrial
Iveco shares skid on debut after spin-off from CNH Industrial

Italian commercial vehicle manufacturer, Iveco Group NV, reportedly saw its shares plunge on market debut by as much as 10.5% after splitting off from its parent company, CNH Industrial on January 1st, on the Milan bourse.

Iveco, which manufactures trucks, buses, powertrains, as well as specialty vehicles, had opened with shares priced at €11.26 ($12.72) each, and reached a market value of €3.05 billion ($3.5 billion). However, by late morning, the shares plunged to €10.14 ($11.46).

The company had decided to become a standalone entity following suit with rivals Daimler Truck and Traton, with CEO Gerrit Marx stating that the company offers investors the opportunity to bet on a relatively small yet dynamic enterprise with proven turnaround skills.

Shares in CNH went up 1.1% to approximately €15.19 ($17.17) as the firm shifted focus completely towards agriculture and construction vehicles, having recorded a string of highs and rising 65% last year.

Monica Bosio, an Analyst at Intesa Sanpaolo, stated that the market might favor CNH and its off-highway business in the short term.

Industry analysts have stated that because of thin holiday trading and the London market being shut, a few days will be needed to properly assess the reaction to Iveco’s spin-off, which meanwhile leaves the company exposed to tough competition.

In an earlier interview, CEO Marx had said that Iveco had been gaining in the light trucks and buses market and was also able to manage its heavy-duty truck business into a good shape.

Marx had added that while the company may be small, it can act fast, and has proven its capability of developing fully electric trucks and also bringing them to series production in the two years.

In November, the company had presented its business plan which focused on zero-emission buses and trucks, promising to work like a startup.

Exor, the holding company under Angelli's family, is the top investor of Iveco and now holds 27% of its common shares with 42.5% voting rights, and has reaffirmed its commitment for the long-term development of the Iveco as well as CNH. 

Source credit: https://www.reuters.com/markets/europe/shares-iveco-indicated-11-euros-each-market-debut-2022-01-03/

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