Deere & Company (DE - Free Report) has reached an agreement with Ag Leader, a precision agriculture competitor, to offer products currently sold by Precision Planting. The agreement depends on Deere’s completion of the acquisition of Precision Planting from The Climate Corporation, a subsidiary of Monsanto Company (MON - Free Report) .
In Nov 2015, Deere signed a definitive agreement to acquire the Precision Planting, LLC equipment business. In Aug 2016, the U.S. Department of Justice (DOJ) challenged the transaction, thus delaying its completion. Deere declared it would contest the DOJ’s action as allegations about the competitive impact of the transaction were misguided.
Deere has long been focused on helping American farmers become more efficient and productive so that they can remain globally competitive. The proposed acquisition benefits farmers by accelerating the development and delivery of new precision equipment solutions that help them increase yield and productivity.
The agreement with Ag Leader will provide it with the technologies and licenses necessary to manufacture and sell the Precision Planting SpeedTube and related technology, including vSet, vDrive, and DeltaForce, once the acquisition of Precision Planting is completed. It will also allow Ag Leader to continue delivering innovative solutions for precision agriculture.
Additionally, it will intensify competition and the availability of various planting solutions. Also, the agreement will enable wider access by offering farmers the choice to either buy new machinery or retrofit older planting equipment made by various manufacturers with the latest new innovations.
Ag Leader will be allowed to sell Precision Planting products using the current names. Importantly, Ag Leader remains a completely independent competitor to Deere and Precision Planting per the agreement.
Deere currently sports a Zacks Rank #1 (Strong Buy). Other well-ranked industrial product stocks are Brady Corp. (BRC - Free Report) and AGCO Corporation (AGCO - Free Report) .
Brady Corp. has posted a positive average earnings surprise of 31.49% over the last four quarters. The stock sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
AGCO Corporation, which carries a Zacks Rank #2 (Buy), delivered an average positive earnings surprise of 62.51% over the trailing four quarters.
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