Agco signs definitive agreement to sell grain & protein business for $700M

Agco has entered into a definitive agreement to sell the majority of its Grain & Protein business to American Industrial Partners in an all-cash transaction valued at $700M, subject to working capital and other customary closing adjustments. Agco expects to use the net proceeds from the transaction consistent with its stated capital allocation priorities, including debt repayment, disciplined investment in technology and organic growth initiatives and return of capital to shareholders. The transaction perimeter to be sold includes the five primary Grain & Protein brands. The transaction perimeter to be sold excludes Agco’s Grain & Protein business in China. The company expects to incur a loss on the sale of the business in the range of $450M-$475M. The transaction purchase price implies a transaction multiple of approximately 8.3x based on Grain & Protein’s trailing twelve months adjusted EBITDA as of March 31, 2024. The transaction is anticipated to close before the end of the year, subject to regulatory approvals and other customary closing conditions.