Fiat's FNH buyout forms N.H. Geotech.

Fiat's FNH Buyout Forms N.H. Geotech

FIAT GROUP of Italy announced on May 7 it had created a new holding company, N.H. Geotech n.v., to run the worldwide agricultural machinery operation business created with Fiat's acquisition of Ford New Holland.

Fiat, of Turin, Italy, will own 80 percent of N.H. Geotech, while Ford Motor Co., of Dearborn, Mich., will own 20 percent. The 2 firms had started the buyout process in December, 1990. The final block to the deal was U.S. Justice Department concern over possible concentration of power in the hay machinery business. That obstacle fell when Allis-Gleaner Corp. bought Fiat's interest in Hesston Corp., which competed with FNH products in the hay machinery market.

N.H. Geotech n.v. was incorporated in The Netherlands, but the headquarters office will be in London, England. The new firm will become 1 of the top 3 agricultural machinery concerns in the non-Communist world, competing with Massey-Ferguson and Deere & Co. for top honors. The combined 1990 sales of FNH an FiatGeotech would have exceeded $5 billion.

Operating divisions of N.H. Geotech will include Ford New Holland Americas, based in New Holland, Pa.; Ford New Holland Europe, based in Brussels, Belgium; Ford New Holland Brazil, based in Curitiba, Brazil, and FiatGeotech, which has tractor, farm and industrial equipment divisions based in Modena and Turin, Italy. Equity participation will be maintained joint ventures in Mexico, Turkey, India and Japan.

Ford Motor Credit Co. will become the larger partner, with 51 percent to Fiat Finance's 49 percent, in a joint venture finance subsidiary that will handle retail and wholesale financing of Ford New Holland products in the United States and Canada.

Fiat noted that its selloff of Hesston to Allis-Gleaner included only domestic operations, and not Hesston operations in Europe, or the Woods Division, Illinois-based maker of rotary cutters, backhoes and other tractor-mounted tools.

Fiat executives have said they have no short-term plans to alter current U.S. dealer structures for the FNH line, and have said they will continue supplying Fiat-made tractors and parts to Hesston dealers.

The board of directors of the new N.H. Geotech operation is drawn largely from the Fiat side of the ledger. Chairman is Giorgio Garuzzo, vice chairman is Giancarlo Vezzalini, with 3 executive vice presidents: Robert Gerrity, Riccardo Ruggeri and Vincenzo Morelli.

The combined operations of FNH and Fiat agricultural machine factories and support networks include more than 30,000 employees, principally in the United States, Italy, Belgium, France, the United Kingdom, Brazil and Canada.