Agco Corp is launching a venture fund for early-stage farm technology as the agricultural machinery giant builds out its digital capabilities and embarks on an acquisition spree for new assets.
The Duluth, Georgia-based company on Monday announced the formation of Agco Ventures, which aims to drive innovations in the startup sector that align with the company’s digital interests, including information management systems and alternative fuel sources.
The venture fund comes as Agco signs a deal to acquire digital assets from FarmFacts GmbH, a developer of farm management information software. Last month, the company reached a $2 billion agreement to acquire the majority of farm assets from tech provider Trimble.
“We aren’t slowing down,” Eric Hansotia, Agco’s chairman, president and chief executive officer, said in a statement. “Our transformation commitment continues via acquisitions and early-stage tech investments that keep farmers at the heart of all we do.”
FarmFacts, based in Pfarrkirchen, Germany, creates software that farmers and service providers use to generate field action plans, such as prescription maps and guidance lines. Products include the Next Farming AG Office application and the Next Farming Live data platform, which offer documentation, fertilizer management tools and other solutions.
The agreement will expand Agco’s software portfolio and development capabilities to better serve farmers’ needs, Agco said. Terms of the pending transaction were not disclosed.
“As a key provider of data management solutions driving productivity and efficiency, FarmFacts will help us to better serve our European farmers,” Seth Crawford, senior vice president and general manager of Precision Ag & Digital, said in a statement Monday.
In the third quarter, Agco sales climbed 10% to $3.5 billion driven by strong demand for high horsepower, higher margin tractors in South America. Net income totaled $280.6 million, an 18% increase over last year as the company focuses on precision technologies and other margin-rich businesses to deliver record results.
Agco shares rose 1%, or $1.27, to close Wednesday at $118.62 on the New York Stock Exchange.