AGCO Corporation (NYSE: AGCO) said on Thursday that it had entered into a definitive agreement to sell the majority of its Grain & Protein business to American Industrial Partners in a $700 million all-cash deal.
The portfolio to be sold includes the five main Grain & Protein brands – GSI, Automated Production, Cumberland, Cimbria and Tecno.
The deal excludes AGCO’s Grain & Protein business in China.
“The divestiture of Grain & Protein supports AGCO’s strategic transformation, recently accelerated by the PTx Trimble joint venture, which closed in April 2024. Divesting this business allows us to streamline and sharpen our focus on AGCO’s portfolio of award-winning agricultural machinery and precision ag technology products, which underpins a long-term focus on high growth, high margin and high free cash flow generating businesses,” Eric Hansotia, AGCO’s Chairman, President and Chief Executive Officer, said in a press release.
“AIP has extensive experience in the industrial sector and vast carve-out expertise, which we believe will unlock new potential for the Grain & Protein business. We believe the move will help ensure its brands continue to lead the market in grain, seed and protein production equipment and remain well-positioned to deliver for farmers,” the CEO added.
Stock Performance
The shares of AGCO Corporation (AGCO) closed 4.10% ($4.01) higher at $101.84 in New York on Thursday, as they snapped a five-day streak of losses.
The company’s total market cap now stands at $7.599 billion.
The shares of AGCO Corporation (AGCO) went down 12.46% in 2023, compared with a 10.99% gain for the benchmark index, NYSE Composite (NYA).
The company’s shares have retreated 16.12% so far this year.
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