Deere & Company has signed a definitive agreement to own 50% of Xuzhou Xuwa Excavator Machinery Company, a subsidiary of Xuzhou Bohui Science and Technology Development Company in China.
"Today's action provides Deere with a foundation in this important and rapidly expanding marketplace with an opportunity to leverage the expertise of XCG in China" said Samuel R. Allen, president, Worldwide Construction and Forestry Division. "XCG is a leader in providing quality machines that perform to high standards for customers, which is a key to enhancing our construction equipment business in this growing market."
The companies are still seeking review of the transaction by government approval authorities in China.
XCG was viewed as a viable partner for the Chinese market because of its strong domestic position as a leading Chinese manufacturer of construction equipment with a broad excavator product line of 14 models. Currently XCG is the third largest domestic excavator manufacturer in China with dealers covering all but two provinces of the Chinese market.
While Deere has a long-term presence in the manufacturing of agricultural equipment in China, this is the company's first manufacturing operation in construction equipment in the country. Deere's construction and forestry division is the world's leading producer of equipment for forestry and a leading provider of a broad range of construction equipment in North America.