Business

Kobe Steel unit sets up Italy venture

Kobe Steel Ltd. said Wednesday that its subsidiary, Kobelco Construction Machinery Co., has set up a joint venture in Italy with CNH Global N.V., a U.S. construction equipment firm, to make and sell crawler excavators.

The new venture, dubbed Fiat Kobelco Construction Machinery S.p.A., will sell crawler excavators under both the Fiat Kobelco and Kobelco brands in Europe starting in January.

Kobe Steel now has manufacturing and marketing bases for construction machinery in Europe, the U.S. and Asia.

Using technology licensed by Kobelco Construction Machinery, crawler excavators will be made at the San Maruo plant, while mini-excavators will be produced at the Imola plant, Kobe Steel said.

Kobelco Construction Machinery, 80 percent owned by Kobe Steel, has claimed a 20 percent stake in the new venture, while CNH has a stake of 75 percent and Sumitomo Corp. has a 5 percent stake.

CNH has also raised its 10 percent share in Kobelco Construction Machinery to 20 percent, the company said.

The move completes a global construction equipment alliance between Kobe Steel, Kobelco Construction Machinery and CNH, which was agreed on between the three firms in March 2001, the company said.