"This alliance is of strategic importance for our current and future position within the global construction equipment business" said Paolo Monferino, CNH president and chief executive officer. "The introduction of the new excavator technology will allow CNH the global reach we require to be competitive in today's market. A best-in-class product offering, economies of scale, purchasing and manufacturing efficiencies, and a stronger and wider distribution network are the key success factors of the newly announced alliance."

"Kobelco will become a full line supplier of construction equipment in Japan and the Asia Pacific region, with the addition of CNH's broad product offering which serves all industry segments in specific customer needs," said Tsuguto Moriwaki, president and chief executive officer of Kobelco. "Our alliance will enable us to better serve our customers worldwide. Customers in Japan and the Asia Pacific region can look forward to a wider range of products and a more extensive network. Kobelco will also have access to state of the art manufacturing plants in Europe."

At closing, CNH has acquired a 10% interest in Kobelco Construction Machinery in Japan and a 65% interest in Kobelco America. Likewise, Kobelco has acquired 100% of CNH's construction equipment operations in Australia, Asia and China, becoming an exclusive distributor of the Case and New Holland brands of construction equipment in this region.

In the third quarter 2002, CNH will increase its interest in Kobelco Construction Machinery in Japan to 20%. During the same period, in Europe, CNH and Hitachi Construction Machinery Company, Ltd. will end their European regional alliance. At that time, the operations of Fiat-Hitachi and Kobelco Construction Machinery (Europe) B.V. will be combined to create Fiat-Kobelco Construction Machinery in Europe. CNH will own 75% of the new entity and Kobelco Construction Machinery will hold a 20% interest. Sumitomo Corporation will maintain its 5% stake.

CNH has the option to increase its interest in Kobelco Construction Machinery in Japan to 35% by the third quarter 2004. Likewise, Kobelco Construction Machinery in Japan has the option to increase its interest in Fiat-Kobelco Construction Machinery in Europe to 35% by the same period.

In Europe, crawler excavators will be sold under both the Fiat-Kobelco and Kobelco brands. Sumitomo Construction Machinery will continue to supply crawler excavators to the Case Construction network and brand, and to the Link-Belt network and brand in the Americas.

Kobe Steel, Ltd. is one of Japan's leading steelmakers, as well as suppliers of aluminum and copper products. Other major businesses include welding consumables, infrastructure and plant engineering, industrial machinery, and electronics and information. For the fiscal year ended March 2001, Kobe Steel had consolidated sales of about US$ 11.1 billion. The company has head offices in Kobe and Tokyo, Japan. For more information, please visit

Kobelco Construction Machinery Co., Ltd., wholly-owned by Kobe Steel, is one of Japan's top manufacturers of hydraulic excavators and cranes. Based in Tokyo, Japan, Kobelco has annual sales of approximately US$ 1.3 billion. For more information, please visit