Deere: shares up after German acquisition.

(CercleFinance.com) - Shares in Deere & Company opened up over 2% on Thursday after the group said it had acquired Wirtgen Group, a German manufacturer of road construction equipment.


The US farm equipment manufacturer said that this acquisition aligns with its long-term strategy to expand in both the agriculture and construction businesses.

The purchase price is close to 4.4 billion euros in an all-cash transaction, with the total transaction value being approximately 4.6 billion euros, including debt.

The Wirtgen Group - which has approximately 8,000 employees and sells products in over 100 countries - generated sales of 2.6 billion euros last year.

Deere said it expects the transaction to have an accretive impact on EPS and currently intends to fund the acquisition from a combination of cash and debt financing.

The transaction should be completed in the first quarter of Deere's 2018 fiscal year, i.e. before the end of January 2018.

Deere shares are currently up 2.5% at 125.5 dollars on the New York Stock Exchange.

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