Deere & Company and The Climate Corporation aren’t going to sit down and idly take the U.S. Department of Justice lawsuit filed today to block Deere’s acquisition of Precision Planting. The duo said they plan to contest the legal action.
The DOJ’s claims buck the November definitive agreement between Deere and The Climate Corporation, a subsidiary of Monsanto, in which Deere planned to acquire the Precision Planting LLC equipment business in full cooperation of the DOJ’s antitrust review.
According to the DOJ complaint, Deere and Precision Planting are the only two effective competitors in high-speed precision planting, accounting for 86 percent of the market … conservatively. The complaint views the head-to-head competition since 2014 as a good thing for farmers — aggressive discounts, promotions, lower prices, and innovative product offerings. If Deere is the only supplier of high-speed precision planting systems, the DOJ’s ruling contends that the company could control nearly every method through which American farmers can acquire the high-speed precision planting systems.
“DOJ’s allegations about the competitive impacts of the transaction are misguided,” Deere said.
According to a news release issued by Deere, the acquisition (reportedly in the $190 million range) will benefit farmers as they will have broader access to these advancements and the choice to either buy new machinery or retrofit older planting equipment with the latest new innovations. Deere also plans to keep Precision Planting’s independence once the acquisition is complete and will continue to invest in additional innovation efforts at Precision Planting to benefit customers.