The Netherlands based agricultural and construction equipment
CNH Global N.V.
) announced the closure of 3.625% senior unsecured notes due
2018, issued at par. The Notes offering is made by CNH Global's
wholly-owned subsidiary, CNH Capital LLC.
This issue was announced less than a week ago. The total
returns from the issue of notes are around $594.2 million, after
incurring expenses. CNH Global will be using the proceeds from
the offering for working capital and corporate purposes, such as,
purchase of receivables and other assets. The proceeds from the
issue will also be used to repay CNH Capital's debts, whenever
The notes carry a semi-annual interest payout policy, which
will be paid on Apr 15 and Oct 15 of each year, starting from Oct
15, this year. The interest is assured by two of CNH Global's
subsidiaries, CNH Capital America LLC and New Holland Credit
Exiting the fourth quarter of 2012, CNH Global had cash and
cash equivalents of $2.0 billion, whereas the total debt balance
stood at $18.1 billion. In 2012, CNH incurred a capital
expenditure of $556.0 million. Total interest expense in the year
was $675.0 million. We expect the interest expense for CNH Global
to increase with the issue of the notes.
In late February this year, board of directors of CNH Global
approved the merger of the company with NewCo, a subsidiary of
Italy-based Fiat Industrial S.p.A. Subject to the completion of
the merger, the shareholders of CNH Global will receive 3.828
shares of NewCo against a share of the company.
CNH Global currently has a Zacks Rank #3 (Hold). Some of the
other players in the equipment sector, worth a look are
Deere & Company
Alamo Group Inc.
); each carrying a Zacks Rank #2 (Buy).
ALAMO GROUP INC (ALG): Free Stock Analysis
CNH GLOBAL NV (CNH): Free Stock Analysis
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