Monsanto’s Climate Corp seen profitable by 2020: CTO Fraley

John Deere & Company is now contesting a legal block from the U.S. Department of Justice that is preventing the company from the acquisition of an equipment business.

“High-speed precision planting technology holds out the promise of improved yields for American farmers by enabling them to plant crops more accurately at higher speeds”, Renata Hesse, acting assistant attorney general of the DOJ Antitrust Division, said.

Deere’s acquisition would combine the only two significant US providers of high-speed precision planting systems used by farms, giving the company control of close to 90 percent of the USA market, the Justice Department said Wednesday in a complaint filed in federal court in Chicago.

In November past year, Deere said it had agreed to pony up an undisclosed sum to secure Monsanto’s Precision Planting equipment business.

When the transaction is finalized, Deere will preserve Precision Planting’s independence in order to ensure innovation and speed-to-market and will invest in additional innovation efforts at Precision Planting to benefit customers.

According to the department’s complaint, Deere and Precision Planting are the only two effective competitors in high-speed precision planting, conservatively accounting for at least 86 percent of the market.

In February, Deere bought Monosem Inc., a maker of precision planters, for an undisclosed amount.

“The complaint details how the intense head-to-head competition between Deere and Precision Planting since that time has directly benefited farmers through aggressive discounts and promotions, lower prices and innovative product offerings”, the department said in a news release.

Deere’s plan to buy the Monsanto unit was announced last November. In a statement August 31, Deere & Company and The Climate Corporation said they both cooperated fully with DOJ’s antitrust review following their late 2015 announcement regarding the purchase. Deere and The Climate Corporation intend to defend the transaction against the DOJ’s allegations. “This transaction will create value by delivering broader access to precision equipment advancements that help farmers increase yield and productivity”, Stern said in a statement. The deal would allow Monsanto to expand sales opportunities for its FieldView app, which provides farmers with real-time planting data, to owners of Deere equipment including tractors.