MILAN (Reuters) -Italy’s Iveco Group has agreed to buy the full ownership of its joint venture with U.S. start-up Nikola developing battery electric and fuel cell heavy-duty trucks for 44 million euros ($48 million), it said on Tuesday.
Iveco, which at that time was part of CNH Industrial (NYSE:CNHI) group, and Nikola formed the joint venture, based in Ulm, Germany, in 2019 to help the Italian truckmaker, a latecomer to electrification, catch up with large European rivals such as Daimler (OTC:MBGAF) Truck or Volvo.
Battery electric (BEV) trucks developed by the JV are already circulating in the U.S., while orders are being collected in Europe. Fuel cell hydrogen hybrid (FCEV) trucks are expected to hit the road next year.
As part of the agreement announced on Tuesday, Iveco will focus on Europe for the further development and commercialisation of its own battery electric and fuel cell electric trucks, while Nikola will concentrate its operations in North America, the two groups said in a joint statement.
Iveco will also have free access to and continue developing vehicle control software for the jointly developed BEVs and FCEVs. Nikola will be granted Iveco’s technology licence for North America and related component supply, the added.
Iveco’s overall investment, through available liquidity, will be partly in cash, for $35 million, and partly in shares, with the purchase of 20 million Nikola shares.
The Italian truckmaker said in a separate statement that the deal would produce a 44 million euro one-off negative impact on its first-quarter income statement that it expected to absorb through cash flow generation, without changing its cash flow target for this year.
Iveco will report its first-quarter data on Thursday.
($1 = 0.9084 euros)
