John Deere’s planned acquisition of Precision Planting has hit a legal roadblock.
The U.S. Department of Justice sued Deere over the deal because the purchase would likely lead to higher costs to U.S. farmers due to lack of competition.
Back in November, John Deere and The Climate Corporation, a subsidiary of Monsanto Company, announced an agreement was signed for Deere to buy Precision Planting.
An anti-trust review was then launched by government regulators which led to Wednesday’s announcement.
A joint statement released by Deere and Climate Corp. says in part, “[The] DOJ’s allegations about the competitive impacts of the transactions are misguided and the companies intend to defend the transaction vigorously against those allegations.”
According to Reuters, the DOJ says Deere and Precision Planting hold at least 86 percent of the market. The transaction price is estimated around $190 million.