Kubota to acquire automation company AgJunction

Farmer checking his smartphone whilst his tractor is driving partially autonomously thanks to AgJunction autosteer. - Photo: Still from AgJunction video
Farmer checking his smartphone whilst his tractor is driving partially autonomously thanks to AgJunction autosteer. - Photo: Still from AgJunction video

AgJunction, a global provider of guidance, autosteering, and autonomy solutions for precision agriculture applications, has entered into a definitive arrangement agreement to be acquired by Kubota Corporation.

Kubota will acquire AgJunction for CAD $ 0.75 per common share, representing a premium of approximately 60% to the closing price of the common shares on the Toronto Stock Exchange on October 7, 2021, the last trading day prior to this announcement, and a 59% premium to AgJunction’s 30 day volume-weighted average share price on the TSX.

Automation rapidly advancing

According to AgJunction, agricultural machine automation is rapidly advancing with increasing investment and consolidation. Adoption of new automation demands tighter vehicle integration and large scale distribution. Given the competitive landscape, delayed adoption rates due to COVID-19, capital requirements and available sources of capital, AgJunction’s Board initiated a confidential process to consider expressions of interest from third parties.

Also read: Kubota and Yamaha invest in robotic strawberry harvester

AgJunction’s Board determined “that the transaction with Kubota represents the best alternative available for AgJunction to create substantial value for our respective stakeholders including the shareholders given the current industry, economic and capital markets conditions as well as existing strategic relationship between AgJunction and Kubota.” The purchase price is all cash and the transaction is not subject to any financing conditions.

In 2019, AgJunction Inc. filed a patent infringement lawsuit through its wholly owned U.S. subsidiaries in the Northern District of Georgia against Kubota Corporation and several of its subsidiaries. The lawsuit alleged that Kubota products violated 3 AgJunction patents related to automated machine control and implement steering.

Claver
Hugo Claver Web editor for Future Farming
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