Acquisitions and mergers continue to change the face of the agriculture industry. A couple of milestone deals were announced just as the year came to a close.
The sale of Bourgault Industries based at St. Brieux, Sask., is a blockbuster. The sale price is $640 million for this leader in seeding equipment and a pioneer of direct seeding. The buyer is Linamar Corp. based in Guelph, Ont. In 2018, Linamar purchased MacDon Industries, with its big combine header manufacturing plant in Winnipeg.
Read Also
Robots, lasers, and AI, oh my!
Advanced field robotics, including laser and high-voltage electricity, is transforming agriculture with AI-driven precision, lower labour costs, and reduced soil disturbance.
Bourgault follows a long line of prairie seeding equipment companies gobbled up by larger entities.
Flexi-coil has long been owned by CNH Global. The manufacturing facility in the north end of Saskatoon that used to turn out Flexi-coil air seeders now builds planters that are mainly shipped to the United States.
Conserva Pak, another pioneer of direct seeding, was sold to John Deere by its founder, Jim Halford, of Indian Head, Sask.
Morris Industries ran into financial difficulties and was bought by Seed-Rite in 2020.
Seed Hawk, based at Langbank, Sask., partnered for years with Vaderstad and in recent years the Swedish company has taken full ownership.
Highline Manufacturing of Vonda, Sask., known for rock pickers and bale processing, was purchased by Bourgault Industries in 2006 and now it’s part of the Bourgault sale to Linamar.
Two Saskatchewan based seeding companies come to mind that still maintain their original ownership — SeedMaster of Emerald Park and K-Hart of Elrose.
Ezee On, with its seeder manufacturing plant at Vegreville, Alta., was bought by Buhler Industries of Winnipeg in 2011.
That leads us to the other big deal recently announced. Buhler Industries, with its Versatile tractors and Farm King line of equipment, has been bought by Basak Traktor (ASKO Holding), headquartered in Turkey.
The sale involves all the common shares of Buhler owned by Russia’s Rostselmash and represents about 97 percent of all the outstanding shares. As someone who owns a Versatile 435 tractor, I’m pleased by the Buhler divorce from Russia and the stability this should bring to the company.
Meanwhile, mergers and acquisitions continue to occur in other segments of agriculture. A big deal announced at the end of 2022 that came into effect in 2023 was the sale of G-Mac’s Ag Team to J.R. Simplot of Boise, Idaho. The sale involved 15 farm input retail stores in Saskatchewan.
Watch for more consolidation in 2024. The Bunge takeover of Viterra could shake loose some assets. Bunge has an equity position in G3, which has18 large elevators stretching from Glenlea, Man., to Rycroft, Alta.
Where G3 and Viterra elevators are in proximity, the Competition Bureau could require the sale of assets as a prerequisite for approving the deal. We’ve seen that before.
It isn’t a good time to be selling grain handing assets. Primary elevators have been overbuilt on the Prairies, especially considering how much additional canola is going to be diverted into new crush facilities in the next few years. In most cases, this is canola that won’t be going through an elevator.
No doubt 2024 will see more surprises like the Bourgault deal. When a business is struggling and actively seeking a lifeline, an acquisition is not unexpected. However, the sales of Bourgault and G-Mac show how healthy companies also assess their options and exit strategies, and those deals are difficult to predict.
Kevin Hursh is an agricultural journalist, consultant and farmer. He can be reached by e-mail at kevin@hursh.ca.
