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Aug. 12, 2024
by Sarah Zimmerman, Editor, AgricultureDrive Dive Brief: *Agco's largest shareholder has moved to shake up the tractor manufacturer's board of directors, saying the agricultural equipment maker's acquisition-focused mindset has negatively impacted performance. *ractors and Farm Equipment Ltd. (TAFE), a global tractor giant and longtime Agco partner based in India, is exploring options to replace Agco's directors through a consent solicitation process, the company disclosed in a 13D investor filing this week. TAFE is Agco's biggest shareholder, holding 16.3% of stock. *TAFE expressed "serious concerns" with Agco decision-making, including a $700 million sale of its grain and protein business. Agco said in a response that TAFE is pressuring the company in retaliation for terminating certain commercial agreements. Dive Insight: Rising tensions between Agco and its top shareholder could ultimately impact the direction of the company's strategic plans to focus on technology and precision agriculture over traditional equipment manufacturing. "Replacing AGCO's independent directors with TAFE's hand-picked nominees would serve only to assist in prioritizing the interests of TAFE and its operations above the interests of AGCO's other stockholders," Agco wrote in response to TAFE's filing. Agco terminated certain commercial agreements with TAFE in April, citing the India-based manufacturer's "poor operational performance as a supplier, brand licensee and distributor." The company said TAFE, which sued in response, is now also retaliating by pushing for board changes. "It is disappointing that it appears that TAFE has now chosen to respond to a commercial decision by threatening the use of the consent solicitation process in an attempt to pressure AGCO," the company said. To read the entire report click here. Tweet |
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