TAFE remits $65.01 mn in US-based Agro Corp

Tractors and Farm Equipment Limited (TAFE), a Chennai-based global tractor major, has remitted $65.01 million (around Rs 342.44 crore) in the US-based $8.8 billion farm equipment major Agco Corporation. It may be noted TAFE has an ongoing collaboration with Massey Ferguson, now owned by Agco Corporation for over 50 years.

While the Reserve Bank of India (RBI’s) Overseas Investment Division’s data on outward FDI from India for September 2012 showed that the company has invested $65.01 million as equity, TAFE’s official spokesperson said, “The money has been remitted and this is towards business relationship with Agco Corporation and to tap international opportunities.”

An e-mail sent to Agro Corporation did not elicit any reply, till the time this story was filed.

It may be noted, TAFE has an understanding with Agco Corp, a Georgia-based (US) farm equipment maker, for distribution in the US, in certain markets in Africa, Turkey and other countries. Agco also holds a 23 per cent stake in TAFE which is headed by Mallika Srinivasan, who has been on the Agco board since last year.

TAFE also said that it is participating in the development of the Centurion family of tractors (50-125 hp) along with Agco Corporation and plans to expand its international footprint. These tractors will be made in India and then it will be shipped to the overseas market during the second quarter of calender 2013, the company officials said said earlier.

TAFE, known for its design, styling, prototyping and manufacture of tractors, including a range of tractors for sale by Agco in the North American markets under the Massey Ferguson brand. TAFE’s products are sold under the Massey Ferguson, Eicher and TAFE brands and its products sold across much of South Asia.

In 2011-12, TAFE sold 20,396 units across 73 countries. As the market softened, to balance it the company recently said that it is planning to expand into new countries including parts of South America, Africa and in South Asia.

Last year, exports contributed around Rs 1,200 crore to the overall turnover of around Rs 8,021 crore and the company expects this proportion to remain more or less the same.

Presently, TAFE manufactures tractors from 24 HP to 100 HP in air-cooled and water-cooled platforms.

For export market it is planning to introduce new products which can go up to 105 HP. By end of the year, it plans to roll out the product for the export market and also new agricultural implement, which will also be domestic markets.