SHANDONG, China, Apr 27, 2011 (BUSINESS WIRE) --
AGCO, Your Agriculture Company (NYSE: AGCO), a worldwide manufacturer and distributor of agricultural equipment, today announced it has agreed to acquire an 80% equity interest in Shandong Dafeng Machinery Co., Ltd. (Dafeng Machinery) in China. Dafeng Machinery was established in 1995 and currently produces a complete range of corn, grain, rice and soybean harvesting machines for domestic markets. The transaction is expected to close later in the year subject to various closing conditions and regulatory approvals.
During the past 10 years, China's combine market has experienced growth due to large advances in agriculture mechanization and government support. AGCO is aiming to become a future market leader in the Chinese combine sector by introducing high horsepower products and advanced technology into the current product offering of Dafeng Machinery, with a clear focus on meeting new customer demands. This ambition of industry leadership is built upon a strategy focused on key areas of products, operations and distribution.
"This is a very important step in delivering our global harvesting strategy," explained Martin Richenhagen, AGCO Chairman, President and Chief Executive Officer. "In combination with the recent investments in our combine operations in Brazil and the United States as well as the acquisition of the remaining 50% interest in the Laverda combine business in Italy, we hope to achieve an annual combine production volume in excess of 10,000 units globally."
"The Chinese agriculture market is a big opportunity," stated Hubertus M. MĂźhlhĂ¤user, Senior Vice President, Strategy & Integration and General Manager, Eastern Europe & Asia. "As a critical step of AGCO's China strategy, the acquisition of Dafeng Machinery will bring significant complementary benefits and substantial value to AGCO's harvesting offering, with an existing production and supplier base for combines as well as an established distribution network."
"The acquisition marks an important step in AGCO's China strategy. Significant synergies are expected in both domestic as well as global operations with exports planned to Asia, Far East and African markets," said Andreas Weishaar, Vice President and Managing Director, China and India.
AGCO, Your Agriculture Company (NYSE:AGCO), was founded in 1990 and offers a full product line of tractors, combines, hay tools, sprayers, forage equipment, tillage, implements and related replacement parts. AGCO agricultural products are sold under the core brands of Challenger(R), Fendt(R), Massey Ferguson(R) and Valtra(R) and are distributed globally through 2,600 independent dealers and distributors in more than 140 countries worldwide. Retail financing is available through AGCO Finance for qualified purchasers. AGCO is headquartered in Duluth, GA, USA. In 2010, AGCO had net sales of $6.9 billion. http://www.AGCOcorp.com
SAFE HARBOR STATEMENT
Statements which are not historical facts, including expectations regarding the fulfillment of the closing conditions, expected combine productions levels, and expectations for the business' future, are forward-looking and subject to risks that could cause actual results to differ materially from those suggested by the statements. These risks include possibility that the closing conditions will not be fulfilled, actions by producers of competitive products and the general risks attendant to acquisitions. Further information concerning these and other factors is included in AGCO's filings with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2010. AGCO disclaims any obligation to update any forward-looking statements except as required by law.
Rebecca Fabian, +1 212-490-4825
Lei Sun, +86 134 2608 1996
Greg Peterson, +1 770-232-8229