Deere Abandons Proposed Acquisition of Precision Planting from Monsanto
Decision to Terminate Deal Preserves Competition in High-Speed Precision Planting Systems Market
The Department of Justice announced today that Deere & Company and the Monsanto Company terminated Deere’s attempt to purchase Precision Planting LLC from Monsanto. The department filed suit on Aug. 31, 2016, to block the acquisition, alleging that the transaction was a merger-to-monopoly in high-speed precision planting systems, an innovative technology that enables farmers to accurately plant corn, soybeans and other row crops at up to twice the speed of a conventional planter. The case was scheduled for trial in U.S. District Court in Chicago on June 5, 2017.
“The companies’ decision to abandon this transaction is a victory for American farmers and consumers,” said Acting Assistant Attorney General Andrew Finch of the Justice Department’s Antitrust Division. “Had this acquisition gone forward, significant head-to-head competition between Deere and Monsanto’s Precision Planting – competition that has led to lower prices and more innovative products – would have been lost. Agriculture is one of the most important sectors of our economy and the Antitrust Division will remain vigilant to ensure that competition in agriculture markets is not thwarted through illegal transactions.”
The proposed acquisition would have combined the only two significant U.S. providers of high-speed precision planting systems. Planting at higher speeds can be highly valuable to farmers, many of whom have a limited window each year to plant their crops to achieve the highest crop yields. As a result, high-speed precision planting technology is expected to become the industry standard in the coming years.
Deere & Company, a Delaware corporation headquartered in Moline, Illinois, is the largest manufacturer of planting equipment in the United States, including its ExactEmerge high-speed precision planting system.
Precision Planting LLC is a Delaware limited liability company headquartered in Tremont, Illinois. It is a leading innovator in planting equipment, including its SpeedTube high-speed precision planting system. Precision Planting is a subsidiary of Monsanto Company, a Delaware corporation headquartered in St. Louis, Missouri.