Wells Fargo Buys CIT Construction UnitCED Magazine August 2007
Article Date: 08-01-2007
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.
President Ron Riecks says to expect "business as usual."
Dealers accustomed to working with CIT Construction can anticipate minimal change in their financial relationship following Wells Fargo & Co.'s recent purchase of the company. The biggest change communicated by the company is its name - CIT Construction will now be known as Wells Fargo Construction.
Wells Fargo completed the acquisition of the construction lending business of CIT Group in late June. Wells Fargo Construction will continue to be operated by the senior leadership team in Tempe, Ariz., and will operate as a division of Wells Fargo Equipment Finance. Ron Riecks, former president of CIT Construction, will head the new company. Terms of the agreement were not disclosed.
CIT Construction has provided commercial financing to the construction industry since 1938. For the past 31 years, CIT has also published an annual construction industry forecast. The company will continue to publish the forecast, now branded as a Wells Fargo Construction forecast.
"There is a very strong cultural fit between the old CIT Construction team and Wells Fargo Equipment Finance," said Riecks. "AED dealers have grown to rely on CIT Construction to support them in many ways, such as financing their rental fleets and providing financing for their retail customers. We will continue to provide them the same level of service they are used to from the old CIT team."
Dealers can expect their CIT contacts to remain intact, along with the phone numbers and addresses.
"It's business as usual in every way and in every aspect," said Riecks.
Riecks says Wells Fargo is looking to expand its presence in the market. For the last three years, CIT Construction has grown about 20 percent. Riecks says with the added strength of Wells Fargo, he anticipates the company will grow steadily for the next three or four years without any trouble.
"Wells Fargo Equipment Finance believed there was a terrific opportunity for financing for AED dealers in the infrastructure construction space and recognized that the CIT Construction was the independent leader," said Riecks. "Wells Fargo saw an opportunity to get a terrific team with a tremendous amount of experience in a space they wanted a bigger presence in."
Both companies were established AED members.
"Both organizations are good players in the industry and have served their customers well," said Toby Mack, AED President. "We're sure the tradition will continue with the acquisition."
Riecks says the acquisition by Wells Fargo will benefit equipment dealers by providing them with a wide menu of additional services, such as money management services and company pension plans. In addition, Wells Fargo N.A. is the only bank in the country and one of only two in the entire world to have the highest credit rating from both Moody's Investors Service and Standard & Poors, securing a strong financial standing for the company.
"CIT has a culture of trying to improve our level of service every day of every week," said Riecks. "We will continue to work on our service level through constant process improvement and driving to continued operational excellence.
Meanwhile, he says, "It's the same friendly people in the same location."
For more information, visit www.wellsfargo.com
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