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THE U.S. DEPARTMENT of Justice filed a lawsuit to stop Deere & Co. from acquiring the Precision Planting equipment business from The Climate Corp., a subsidiary of Monsanto Co.
According to Reuters, the government claims the proposed deal would mean higher prices for farmers who want to buy equipment for high-speed precision planting. Prosecutors are particularly concerned that Deere is selling both planters and the technology to go on the planters.
“By offering farmers high-speed precision planting retrofit kits at a fraction of the cost of a new planter, Precision Planting posed a formidable challenge to Deere and its profitable sales of new planters,” the Department of Justice stated.
Reuters reports that a Deere ExactEmerge planter that includes components for precision technology sells for about $150,000, while a Precision Planting retrofit kit costs about $30,000.
Deere & Co. and The Climate Corp. signed a definitive agreement for Deere to acquire Precision Planting in November 2015. The companies say they fully cooperated with the Department of Justice’s antitrust review and they plan to contest the lawsuit.