TAFE, AGCO settle feud over Massey Ferguson brand outside court

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2 days ago

Under the settlement, ownership of the Massey Ferguson brand will rest with TAFE as the sole and exclusive owner for India, Nepal and Bhutan. TAFE said it will hold all rights, title and interest in 'Massey Ferguson' and related trademarks and all goodwill associated therewith.
In separate statements, the two companies said they have settled all matters relating to the Massey Ferguson brand, commercial issues and shareholding, thus ending their corporate feud.
New Delhi, Jul 1 (PTI) Tractors and Farm Equipment Ltd (TAFE) and AGCO Corporation on Tuesday announced a comprehensive out-of-court settlement of all outstanding disputes, with the Indian firm agreeing to buy out the US-based firm's shareholding in it for USD 260 million (nearly Rs 2,225 crore).
Besides, TAFE will buy back AGCO's shares in itself, which amounts to 20.7 per cent of the domestic tractor maker's equity, for a consideration of USD 260 million, making TAFE a wholly-owned subsidiary of the Amalgamations Group, a diversified industrial conglomerate, headquartered in Chennai, it added.
TAFE will also retain its shareholding in AGCO at an ownership level of 16.3 per cent and not exceed it, while participating in AGCO's future buyback programs to maintain its proportionate ownership subject to certain exceptions, it stated.
As part of the settlement, TAFE will support AGCO by voting its shares in favour of all the recommendations of AGCO's Board of Directors at shareholder meetings, subject to certain exemptions, the Chennai-based firm said.
Besides, TAFE will remain a long-term investor in AGCO, it added.
While all commercial agreements between TAFE and AGCO will be mutually terminated, TAFE will honour outstanding supply orders and continue to supply parts for all markets on agreed terms, it stated.
AGCO, in its statement, said, 'Parties have agreed to mutual non-disparagement and TAFE not engaging in public activism.
TAFE will no longer be entitled to nominate a representative to the AGCO Board of Directors and AGCO's Director on TAFE's Board will step down.' The two companies said their agreements will become effective upon the completion by AGCO and TAFE of certain governmental and other processes in India relating to the repurchase of the shares held by AGCO in TAFE.
'As we step into a new era in TAFE's growth story, we recognise and cherish the long partnership we've had with AGCO, and continue to support AGCO as an engaged shareholder,' TAFE Chairman & Managing Director Mallika Srinivasan said.
Stating that TAFE and Massey Ferguson have been synonymous in the minds of the Indian customers for over 65 years, she said, 'We re-dedicate our commitment to transformation of Indian agriculture through our innovative products, solutions and service to the farming community in India.' AGCO Chairman, President and CEO Eric Hansotia welcomed the reaching of an amicable resolution with TAFE on all outstanding commercial, governance and shareholding matters.
'We appreciate the TAFE relationship for its years as a commercial partner and continued support as a shareholder. AGCO's Board and management team are fully focused on our Farmer-First strategy, which we believe will improve outcomes for farmers, drive operational success for our company and deliver strong returns for shareholders,' Hansotia said.
AGCO said it will file the agreements with the US Securities and Exchange Commission.
Last year in September, AGCO Corporation terminated multiple agreements with TAFE, including the Massey Ferguson brand license agreement, a distributor agreement for India, Nepal, and Bhutan.
Subsequently, a legal battle followed with TAFE taking the matter to the Madras High Court. PTI MSS RKL MR
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