AGCO is set to become a majority owner of Trimble’s precision agriculture business.
The two companies have entered a joint venture agreement, which will see AGCO pay Trimble US$2 billion for an 85 per cent stake. JCA Technologies, the Manitoba-based autonomous tech company which was acquired by AGCO in 2022, will also be brought into the joint venture.
“This landmark transaction creates a JV that becomes the premier mixed-fleet Precision Ag business in the world and accelerates AGCO’s strategic transformation,” said Eric Hansotia, AGCO’s Chairman, President and Chief Executive Officer, in a news release on Thursday. “This deal significantly enhances AGCO’s technology stack with disruptive technologies that cover every aspect of the crop cycle, which ultimately helps us better serve farmers no matter what brand they use.”
The two companies say they plan to leverage multi-channel access across Trimble Ag, AGCO OEMs (which include Fendt, Challenger, Massey, Valtra, and Gleaner), other OEMs, and Precision Planting dealers.
“The exclusive access to Trimble Ag products, combined with AGCO’s existing Precision Ag offerings also accelerates AGCO’s growth ambitions around autonomy, precision spraying, connected farming, data management and sustainability. All of these touchpoints will result in us being even more farmer focused,” says Hansotia.
The $2 billion price tag for 85 per cent ownership in the Trimble Ag business represents an implied enterprise value for the Trimble business of approximately $2.35 billion.
The companies say they expect to close the deal in the first half of 2024.
AGCO also announced its Grain and Protein business will be placed under strategic review “to ensure the Grain & Protein customers are serviced in the best way possible, and that the business is best positioned to maximize its full potential.”