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UPDATE 1-CNH shares fall after talks end to sell Iveco to China's FAW

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MILAN, April 19 (Reuters) - Shares in CNH Industrial fell as much as 5.4% on Monday after the vehicle and equipment maker said over the weekend it had ended talks to sell its truckmaker unit Iveco to China’s FAW Jiefang.

Milan-listed shares in CNH were down 4.3% at 1055 GMT.

CNH said in January it was in talks with FAW over the future of Iveco, the smallest of Europe’s traditional truckmakers which competes with the likes of Volkswagen, Daimler and Volvo Group.

A possible sale of Iveco emerged as an alternative to CNH’s 2019 plan to split the industrial equipment and automotive group in two and list its lower-margin truck and bus business along with its FPT engine division in an effort to boost asset values and streamline its businesses.

Talks, involving all of Iveco’s commercial vehicles business as well as a minority stake in FPT, ended due to a disagreement over the price offered by FAW, a source close to the matter said.

The Chinese group valued Iveco at over 3.5 billion euros, a second source has said.

CNH, which is controlled by Exor, the holding company of Italy’s Agnelli family, said on Saturday it was continuing to pursue its plan to spin-off its truck, bus and engine business, aiming to complete it in early 2022.

“We believe that the spin-off plan will enable the still un-expressed value of both the group’s ... business to emerge,” Intesa Sanpaolo analyst Monica Bosio said.

Italian Industry Minister Giancarlo Giorgetti on Saturday welcomed the end of talks. (Reporting by Elisa Anzolin and Giulio Piovaccari; Editing by Edmund Blair and Mark Potter)

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