The Lely Group, which is well known for its automated milking systems, is to sell the forage side of its business to AGCO, the owners of Massey Ferguson, Valmet, Challenger and Fendt tractors for an undisclosed sum.

The sale will allow Lely to fully concentrate on the dairy side of its business, while AGCO will further broaden its portfolio of agricultural equipment.

The Lely Group, founded in 1948, is active in more than 60 countries and currently employs around 2,000 people. This will fall to around 1,300 under the new arrangement. Speaking to the Irish Farmers Journal, Lely vice-president Andre Van Troost said that, as a family-owned business, making the decision to sell the forage business and put jobs at risk was a tough one. He said that as they did not have tractors, they just couldn’t be competitive in this market any more.

CEO Alexander van der Lely explained the strategy behind the decision: “Lely intends to focus entirely on its role as innovator in the field of robotisation and sensor and data systems for use on dairy farms. Over the last 15 years, these product groups have grown into a successful activity for Lely, with a great deal of potential for the future. Besides the innovative milking robot, other products have also been developed that are primarily based on automation with the aid of robots.” Martin Richenhagen, AGCO’s Chairman, and CEO said that the acquisition will further strengthen AGCO’s full line product offering. Lely will continue to produce its dairy machines in the Netherlands, Unites States and Germany.