Trimble, Agco form joint venture

Trimble (TRMB) announced a definitive agreement to form a joint venture with AGCO (AGCO) to better serve farmers with factory fit and aftermarket applications in the mixed fleet precision agriculture market. Trimble and AGCO’s shared vision is to create a global leader in mixed fleet smart farming and autonomy solutions. In aggregate, Trimble expects approximately $3B in value from the transaction from pre-tax cash proceeds, Trimble’s 15% stake in the joint venture, and the related commercial agreements. Under the terms of the JV, Trimble will contribute its precision agriculture business excluding certain Global Navigation Satellite System and guidance technologies and AGCO will contribute its JCA Technologies business, which is a leader in the development of autonomous software for agricultural machines, implement controls and electronic system components. Trimble will receive $2B in pre-tax cash proceeds plus a 15% stake in the JV. In addition, the parties will enter into (i) a long-term Supply Agreement through which Trimble will provide the JV with key GNSS and guidance technologies, (ii) a Technology Transfer and License Agreement to govern the licensing of Trimble trademarks and technology for use by the JV after the expiration of the Supply Agreement and (iii) a Positioning Services Agreement through which the JV will serve as a channel partner to Trimble for its positioning services in the agriculture market. The transaction is expected to close in the first half of 2024, subject to customary closing conditions including regulatory approvals.