John Deere announces the purchase of precision planting, creating more choices for John deere customers

Deere & Co., the world largest maker of agricultural machinery, agreed to purchase Monsanto Co. Precision Planting LLC equipment unit as it adopts a strategy to improve farmer efficiency and productivity with technology.

Moline, Illinois-based Deere will acquire assets including factories, the Precision Planting brand and most of the unit product coverage, the manufacturer said Tuesday in a statement.

The buying is the third precision agriculture accord Deere has announced in five weeks. This included Monday agreement to acquire Monosem, the Europeanleader in precision planters. For Monsanto, the deal makes more sales opportunity for its FieldView app, which provides farmers with real-time planting data,to owners of Deere equipment including tractors.

 Digital Agriculture

"By this cooperation, we have increased greatly the number of cabs that have the potential to connect to the Climate platform," Raines said by phone Tuesday. "We are doubling down on our focus on the digital agriculture space."

John Deere is working hard to make machines more technologically latest and total food production more efficient. On October 8th, the company agreed to establish SageInsights, a joint venture to further develop a cloud software platform called MyAgCentral developed by data and software firm DN2K for agricultural retailers and other professionals.

" Agriculture is changing significantly," CIO of John Deere John May said by phone. "Deere wants to seamlessly connect people with equipment, technology and insights to offer them a greater advantage with that entire production cycle."

Seed Prescriptions
Precision Planting, founded in 1993, was acquired by St. Louis-based Monsanto in 2012 for $210 million. Its main plant is in Illinois, and it has some businesses in South America. Precision Planting components can be used to enhance new seeding equipment or to retrofit older equipment for precision applications. For example, they can be used to apply the right pressure to sow seeds in the best depth and spacing for maximum yields.

Climate Corp. will keep the digital agriculture portfolio that has been combined into its FieldView platform. John Deere has agreed to allow Climate Corp. to use its software connection to allow customers to send agronomic prescriptions from FieldView through the John Deere Operations Center to their equipment,.

Monsanto now has contracts to combine FieldView with the three largest farm equipment makers, following previous agreements with CNH Industrial NV and Agco Corp., Raines said.

"By signing a deal with John Deere, they are now cooperating with arguably their biggest competitor in this emerging area," Paul A. Massoud, a Washington-based analyst at Stifel Nicolaus & Co. who suggests buying Monsanto shares, said in a note Tuesday. "Should precision agriculture introduction continue to grow, Monsanto now has an even better market position."

John Deere purchase is expected to be concluded in 60 to 90 days, after which Precision Planting will operate independently as a wholly owned branch company of John Deere.

John Deere is facing a third straight year of falling revenue and earnings per share in the fiscal year that started this month as sales of farm equipment such as combines and tractors continue to drop around the globe because of lower crop prices. Farm equipment sales will likely be "disappointing" in 2016 as weak markets and an inventory surplus weigh on the industry, said Bloomberg Intelligence analysts Christopher Ciolino & Karen Ubelhart in a report on October. 13.