MachineryLink

When Kubota President Yasuo Masumoto told journalists in 2012 that his company was in pursuit of a large farm equipment company, the news made a splash. The "why" within the story was obvious: Booming commodities markets had made production agriculture one of the few bright spots in a dismal world economy. Kubota wanted a bigger piece of the action.

The "who" in the story was a harder question. Who did Kubota covet? More on that later.

Reuters in 2012 reported that Osaka based machinery giant Kubota -- which is known for high quality small tractors, mowers and loaders -- was prepared to spend around $2.6 billion to acquire a major farm equipment manufacturer.

"Japanese companies are looking overseas for ways to expand beyond a stagnant home market and take advantage of the yen's near historical highs against the U.S. dollar and euro," Reuters reported.

Masumoto's goal was to have a deal by autumn 2012. But after the original uproar, not much happened publicly with Kubota's quest for about a year.

The pot is boiling again. In January 2013 Kubota named Todd Stucke its new vice president for the agriculture and turf division. Stucke, a rising star at AGCO as its vice president for marketing, was quite a catch. He told DTN/The Progressive Farmer, "My coming to Kubota is part of the [Kubota's] vision of getting into big agriculture."

Kubota is a company that grew from within. It has always done its own R&D, launched its own products and built its own factories. So looking for an acquisition as a path for growth is against type for Kubota. But it is typical for AGCO, where Stucke cut his executive teeth.

"We [Kubota] have an appetite to grow and to invest," Stucke said.

As it was in 2012, the big question now is: Who will Kubota buy?

Back then analysts interviewed by Reuters speculated that Kubota likely would pursue European companies like Claas or Same Deutz-Fahr, both of which make tractors and a broad variety of other production farming equipment. Or, Reuters wrote, Kubota might have its sights set on "brands owned by" John Deere, CNH or AGCO. Privately, Kubota executives who didn't want to be quoted, told me Deere and AGCO are not realistic targets.

Case IH and New Holland are so intertwined, it's hard to image CNH separating them. The Italian company, Fiat Industrial, owns CNH.

Looking around North America, one insider suggested that Canadian based Buhler, which makes Versatile tractors, might be a match. But Buhler doesn't have a broad line of equipment.

Stucke, of course, wasn't naming names for possible acquisition. He did say that Kubota needs three things to drive the kind of growth it wants -- products, dealers and product support. That list seems to limit the possibilities to a few, well-established companies.

If Kubota so far lacks a solid partner, it certainly does not lack ambition. Greg Embry is Kubota's senior vice president for marketing and dealer development. He predicted, "In 10 years Kubota will be a full line ag equipment company." And, he added, "It will have a construction element."

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