Friday, 31 March 2017 14:55

Lely set to offload forage unit

Written by  Mark Daniel
AGCO says it expects to buy the forage division of the Lely Group. AGCO says it expects to buy the forage division of the Lely Group.

In one of the farm machinery industry’s worst-kept secrets, global manufacturer AGCO says it expects to buy the forage division of the Lely Group.

Subject to regulatory approval, the deal will be completed by the end of the fourth quarter in 2017.

This will allow AGCO to strengthen its product offering, particularly in balers and loader wagons, and allow Lely to concentrate on the dairy automation sector, a growth area of its business in the last few years.

Commenting on the sale, Lely chief executive Alexander van der Lely says the company “intends to focus as a leader in dairy robot technology, and on data and sensor systems used on dairy farms”.

“Over the past 15 years these areas have been a major source of growth for this company, and they offer us great potential.”

Production of dairy equipment will continue at the Maassluis, Netherlands HQ and at plants in Pella, US and Leer, Germany.

Production of grassland machinery such as mowers, rakes and tedders, now made at Maassluis, will be moved to other AGCO plants, with production ceasing by March 2018.

The Wolfenbuttel and Waldstetten factories in Germany, where balers and loader wagons are produced, respectively, will be acquired by AGCO.

Lely staff numbers are likely to drop by up to 200; some say 100 people will depart the Lely HQ.

AGCO New Zealand manager Peter Scott says “the acquisition broadens our product offering and gives our dealers and their customers more choice, while also offering the parts and service support they have come to expect for AGCO brands”.

Work will now start to integrate the Lely products into the AGCO line-up and decide whether there is room for both those and the Fella brands.

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