Canada’s Caterpillar equipment distributor for Manitoba and points east is set to sell a major Manitoba dealer of Agco’s farm equipment brands as well as the province’s exclusive dealer for Claas combines.
Toromont Industries announced Monday it will sell its AgWest Ltd. arm to Dutch equipment distributor Mechan International, effective May 1.
Neither company would disclose the financial terms of the deal Monday, except that it will be in cash and “is not expected to have a material impact on Toromont’s overall future operations, revenue or earnings.”
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AgWest operates three dealerships and three parts-and-service satellite locations in the province, handling all Agco’s product lines including Fendt, Massey Ferguson, Challenger, Sunflower, White, Rogator, TerraGator and Wilmar. It also holds exclusive rights to distribute Claas combines in the entire province.
The AgWest network includes its head office location at Elie, about 30 km west of Winnipeg, plus its dealerships at Brandon and Neepawa and satellite locations at Swan River, Morden and Russell.
Mechan plans to continue to operate the business under the AgWest brand and retain the current management, staff and number of sites, Toromont said.
“Mechan’s global presence, deep agricultural knowledge, and solid distribution reputation offer a strategic fit with AgWest’s people, customers and suppliers,” Toromont said.
“Thanks to the dedicated AgWest team, loyal customers and strong supplier support, the AgWest business has improved consistently over the past few years,” Toromont CEO Scott Medhurst said in a release.
Concord, Ont.-based, publicly traded Toromont created AgWest in 2014, when it bought two Manitoba ag dealership chains and merged them under the one banner.
In its 2022 annual report, Toromont said AgWest “benefitted from a recovery in commodity prices and strong execution leading to higher market penetration and growth in combine and tractor market shares.
“Improved operational execution and added customer deliverables contributed to much improved overall performance,” the company said.
Mechan is an arm of Zweegers Equipment Group, a Dutch investment firm focused on equipment. Toromont noted Zweegers has a “long association with agricultural equipment including the distribution of Agco and Claas products worldwide.”
“This acquisition aligns with our aim to expand the geographical footprint and add new equipment brands,” Mechan board member Ronald Slaats said in that company’s release.
“For us, people, and local entrepreneurship are paramount, we share our ‘boots on the ground’ approach and deep-rooted passion for equipment, working towards a sustainable future. We are convinced that AgWest’s culture and working methods are in complete harmony with this,” Zweegers CEO Gerrit van der Scheer said in the same release.
Agco’s Americas vice-president for distribution, Bill Hurley, said in a separate release Monday that Mechan’s ownership of AgWest would bring “expanded capabilities, investment and international perspective to the table.”
Mechan’s resources, he said, offer “substantial growth opportunities for Agco products in Manitoba, especially for our Fendt brand as it continues its very successful expansion into the region.” — Glacier FarmMedia Network