Deal aimed at raising Japanese company's share in world's largest tractor market
Nikkei Staff writers
OSAKA -- Top Japanese farm equipment maker Kubota announced Thursday that it will purchase major Indian farm equipment maker Escorts for around 140 billion yen ($1.2 billion), turning the company into a subsidiary.
The move comes as Kubota is aiming to expand its business in India, the world's largest farm equipment market on a unit basis.
Kubota and Escorts established a joint venture to manufacture tractors in 2019. The following year, Kubota announced that it would buy a 10% stake in Escorts for 16 billion yen. The investment was meant to leverage Escorts' market knowledge and parts procurement network to reduce costs.
There is growing demand for low-priced tractors and other farm equipment developed jointly by the two companies, both in India and in other markets.
Escorts was founded in 1944. The company had revenue of around $870 million in the fiscal year ended March 2019. The company employed 11,000 people as of December 2019.
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