Deere & Co. says its proposal to buy Precision Planting, an agricultural equipment and technology company, will increase consumer choice and directly benefit growers, in a response to the U.S. Department of Justice’s lawsuit to block the acquisition.
Deere announced its planned acquisition of Precision Planting in November 2015, for about $190 million. Precision Planting’s parent is The Climate Corp., a unit of Monsanto.
In August, the Justice Department said the proposed deal would mean higher prices for high-speed precision planting equipment, which allows farmers to plant row crops, such as corn, up to twice as fast as with conventional machinery.
In its response filed Wednesday, Deere challenged the Justice Department’s definition of “high-speed precision planting system,” saying it was vague and ambiguous. Deere also denied “that there is any meaningful economic market consisting of ‘high-speed precision planting systems.’”
The Justice Department declined to comment on Thursday.
Deere said the Justice Department initially cleared its proposed acquisition in October 2015 in compliance with the Federal Trade Commission’s Hart-Scott-Rodino Act. Clearance is separate from actual approval of a deal.
Following a protest by an unnamed Deere competitor, the Justice Department opened a new investigation and filed a lawsuit in August to block the transaction, Deere spokesman Ken Golden said, referring to legal documents the company filed on Wednesday.
“It is our position that this case is designed to protect a competitor, not competition,” Golden said.
ARTICLE CONTINUES BELOW ADVERTISEMENT
CNH Industrial and AGCO are Deere competitors that have agreements to factory install Precision Planting equipment on their new planters.
Additionally, Deere entered into an agreement with Ag Leader, an agricultural technology company, to manufacture and sell Precision Planting products if the acquisition is completed, as a possible remedy to the Justice Department’s competition concerns.