“One of the keys for us was making sure we found a partner that was committed to preserving the Versatile and Farm King brands,” said Adam Reid, VP of sales and marketing at Versatile.

“We wanted to make sure the viability of the plant here in Winnipeg and our staff was secure. And taking care of all of our stakeholders, the suppliers, shareholders.”

In July, management at Buhler Industries, parent company of the Versatile and Farm King brands, revealed it had begun a search for a “long-term investment partner”. In late December it announced that Turkish tractor manufacturer Başak Traktör, a wholly-owned subsidiary of ASKO Holding, was buying 96.7 per cent of its outstanding shares for a reported CAD $60.5 million.

Başak Traktör presented what was described as the most “well rounded” proposal, which met their concerns.

“Başak Traktör, has several manufacturing facilities in Turkey,” said Reid. “They’re big in ag and construction equipment. They’re very passionate about that sector.”

“Sami Konukoglu, (chairman of ASKO Holding) is extremely passionate about manufacturing, particularly agricultural manufacturing,” Reid added. “He started on the factory floor and worked his way up. He has a vision for global expansion and sees Versatile as a key to that. He understands the power of the Versatile and Farm King brands… he’s focused on the growth and expansion of the company.”

Talks with Başak Traktör had been underway since early fall, according to Reid, who expects the deal will be finalized by the first week of January. All of the roughly 24 million ownership shares to be acquired by Başak Traktör belonged to Russian ag equipment manufacturer Rostselmash, which had been the majority owner until now.

Brands will continue, expand

Some of the brand’s dealers have expressed apprehension at the thought of a change of ownership and what that might mean for the brand. Senior management, including COO Grant Adolph along with Reid, will remain in their current roles under the new ownership structure to help maintain consistency during the transition and moving forward.

Reid says dealers and customers needn’t worry about the brand disappearing. Instead, he expects it to grow and expand under the new ownership.

Due to the supply chain disruptions in the last two years, Versatile has struggled to fill orders for new tractors, due to persistent component shortages. The new ownership will give the brand increased purchasing power and should help it ramp up the number of tractors rolling off the assembly line to better meet customer demand.

It could conceivably also result in an expanded product line for Versatile, whose tractor offerings only go up from 175 horsepower. Başak’s models conveniently run from 50 to 120, and it could make a good fit for brand expansion. Versatile has so far avoided the temptation to design smaller models to play in the lucrative and very large utility tractor segment, because of the large number of players already there. But with a ready line of models from Başak, that could change. All that, though, remains speculation at the moment.

Başak’s 5120 model, which was released in 2019, won an iF Design award. So the Turkish brand now produces models with features that could potentially appeal to North American buyers.

“There could be some synergy in the long run,” acknowledges Reid. “But at this point the focus is on Versatile and on the manufacturing here, and pushing for growth here.”

As for the assembly of Kubota M8 tractors at the Winnipeg plant, Reid says that will continue.

“This (ownership) change does not affect our current relationships,” he said. “I think what we’re excited about is the passion that Başak Traktör and ASKO Holding brings to the manufacturing side of our business. They’re very forward-looking and we’re excited about where we can go together.”

“I think this opens up a lot of opportunities for us going forward. Internally, the team is very exciting about what this means for securing the future of the Versatile brand.”

Russians out

While the deal brings a new partner on board with a global vision willing to advance the Versatile brand, it solves one other problem for Buhler: it ends the involvement of a Russian company in its ownership. That had been causing some trouble for Versatile due to the invasion of Ukraine.

“The nature of who our major shareholder was did create some concern in some of our suppliers,” said Reid. “Even though Buhler Industries as an entity operated independently and autonomously, there were concerns about the ties back to Russian ownership. So we’re very excited about what this change in ownership can do for us when it comes to our global partnerships with our suppliers.”

Since Russia attacked Ukraine, management at Buhler has had to take steps to publicly distance itself from its primary shareholder. In March of 2022, the board of directors announced it had removed Konstantin Babkin, who had been on Buhler’s board since Rostselmash acquired majority ownership of Buhler in 2007. He had been a vocal supporter of Vladimir Putin and Russia’s aggressive action in Ukraine. The Buhler board quickly and publicly denounced Babkin’s outspoken views, noting they didn’t reflect the values of the board overall or those of Buhler Industries.

However, the company remained under majority ownership by Rostselmash. And some Russian representatives remained on the board. With the Başak acquisition, all board members will have to resign and be replaced with those selected by the new owner.

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Winnipeg-based Buhler Industries on Aug. 14 reported net income of $16.1 million on $67.6 million in revenue for its second quarter ending June 30, up from $1.1 million on $57.8 million in the year-earlier Q2.

Buhler said it “achieved higher sales as it begins to see improvements in the supply chain issues experienced over the last two years.”

The company said it also expects increased sales during the rest of 2023, on a “large backlog of sales (and) strong demand for agricultural machinery and equipment.”

Buhler in its second quarter also booked its revenue from the sale of its tillage equipment manufacturing plant at Vegreville, Alta., which it shuttered in 2021. The company closed on the sale of the former Ezee-On plant in April.

The Q2 ledger also includes proceeds from the sale of Buhler’s property at Woodstock, Ont. — on which it has exercised an option to lease back for up to five years.

Buhler said in April that the combined net proceeds from those plus the sale of its property at Fargo, N.D., which it booked separately in its first quarter, came in at $24.3 million. In its Q2 report, it logged the combined Vegreville and Woodstock sales as a gain on disposal of assets valued at $12.4 million.

The company said in July that the sale of those “underutilized assets” has helped it to secure “sufficient capital for current operational needs” — but it also announced at the time it has hired a Toronto firm, Origin Merchant Partners, to identify a new “long-term investment partner” for Buhler.

Buhler said in July it “seeks to bolster its position in the agricultural industry and continue its commitment to serving farmers and dealers with high quality farm equipment.”

The company didn’t say what its future plans would be if a new investment partner is brought on board. It said its “search for the right investment partner is driven by a commitment to preserving the legacy of the iconic Versatile and Farm King brands.”

Buhler also said it wants a partner “who understands and respects the historical significance of these brands, as well as their immense potential for future growth and innovation.”

Shares in Buhler today are about 97 per cent owned by Russian farm equipment firm Rostselmash, while the remaining three per cent are publicly traded and held by employees and other investors. A Buhler representative wasn’t available for comment this week. — Glacier FarmMedia Network

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Buhler’s board announced Wednesday it has accepted the resignation of Konstantin Babkin, the president and co-owner of Russian holding company Novoe Sodrugestvo, the owner of ag equipment maker Rostselmash, which in turn holds almost 97 per cent of Buhler.

Babkin has been a Buhler board member since 2007, when Rostselmash took up an 80 per cent stake in the Canadian company, best known as the manufacturer of Versatile tractors and Farm King implements.

Buhler has publicly condemned Russia’s launch last week of an invasion against neighbouring Ukraine. On Wednesday the company also announced a fundraising effort in partnership with the Red Cross, offering to match staff and dealer donations up to $100,000 total, in support of humanitarian aid in Ukraine.

Babkin, however, “has been a vocal supporter of the actions taken” by Russia — views which Buhler said Wednesday are “in stark contrast to those of the North American executive team and do not reflect the position or values of Buhler Industries.”

Babkin is also known as a co-founder of Russia’s Action Party, which is said to be allied with Russian President Vladimir Putin and his regime — and he has been seen as particularly vulnerable to potential sanctions by Canada.

In 2014, the Ukrainian-Canadian Congress urged the Canadian government to consider sanctions on Babkin for his public support of Russia’s annexation of Ukraine’s Crimean peninsula.

Babkin was replaced Wednesday on the Buhler board by the Winnipeg company’s vice-president of sales and marketing, Adam Reid.

Reid — a former editor of Glacier FarmMedia’s Alberta Farmer Express newspaper — “has over 15 years of experience with (Buhler) and has been pivotal in recent growth, building trust and relationships with the Versatile dealer network,” Buhler said Wednesday.

Buhler on Wednesday also announced the appointment of its chief operating officer, Grant Adolph, as the chairman of its board. He replaces Dmitry Udras, another Novoe Sodrugestvo co-owner, as Buhler’s chair.

Buhler also named Ossama AbouZeid as a member of its board and chair of its audit committee. AbouZeid had served as Buhler’s president and chief financial officer up until the Rostselmash takeover in 2007.

On the board, AbouZeid replaces Buhler Industries founder John Buhler, who “has decided to retire,” the company said Wednesday.

Buhler Industries, in its statement last week condemning the Ukraine invasion, emphasized that despite its majority shareholder, the Canadian firm “is not a Russian company” and its decisions “are made in Canada.”

The new appointments to the board, it said Wednesday, are meant to “align the organization with the values of the Canadian-based leadership team.” — Glacier FarmMedia Network

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Buhler Industries, which manufactures the Versatile tractor line and Farm King equipment, is majority-owned by the Russian firm Combine Factory Rostselmash. That firm purchased an 80 per cent stake in Buhler in 2007 and boosted that to 97 per cent ownership in a share acquisition deal announced just before Christmas.

Buhler Industries said in a statement Thursday it “strongly opposed” the invasion and “does not condone this attack.”

The company went on to state “Buhler is not a Russian company. Our values are rooted in North America, where the company has been in operation since 1932.”

Buhler said it “operates with autonomy” and its “decisions are made in Canada.”

According to Buhler’s 2021 fourth-quarter report, however, several senior company leaders are Russian nationals and former Rostselmash managers. Those include president Marat Nogerov, vice-president Maxim Loktionov, CEO Yury Ryazanov, chairman Dmitry Udras and board directors Oleg Gorbunov and Konstantin Babkin.

Babkin is particularly vulnerable to Canadian sanction as a co-founder of Russia’s Action Party, which is said to be allied with Russian President Vladimir Putin and his regime. Udras and Ryazanov are also said to be members of the party.

In 2014, the Ukrainian-Canadian Congress called on the federal government to sanction Babkin for publicly supporting a Russian invasion of Crimea.

Buhler said Thursday it “will continue operations as usual, maintain production targets and continue to build tractors and implements to support farmers in North America.”

The Winnipeg firm said it “appreciate(s) the longstanding relationships we have with our dealer network, suppliers and partners and look(s) for grace during this disturbing time.”

The Canadian government on Thursday announced a new round of sanctions against 62 individuals and entities, including senior Russian ministers, and also said it would cancel export permits to that country. Canada exported about $666 million in goods to Russia in 2019. — Manitoba Co-operator staff, with files from Reuters

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Winnipeg-based, publicly-traded Buhler Industries announced Wednesday that Combine Factory Rostselmash has bought another 16.3 per cent of Buhler shares for $3 per share, or about $12.25 million.

Buhler, whose own product lines include Versatile tractors, combines, seeding and tillage equipment and Farm King implements, also makes the M8 tractor line for Kubota at its Winnipeg plant.

Rostselmash, which bought its 80 per cent stake in 2007, has picked up the additional shares in a private deal with Highland Park Financial, controlled by Buhler board member and former chair John Buhler, the company said.

The deal raises Rostselmash’s stake from 80.4 per cent up to 96.7 per cent of Buhler Industries, which said Wednesday the Russian firm’s latest purchase was made for “investment purposes.”

Buhler’s TSX-traded stock closed Wednesday at $2.95 per share, its lowest value since February.

Starting as a state-owned factory in 1929, Rostselmash started producing combine harvesters in 1931, went publicly traded in 1992 and was taken private in 2000.

The company, based at Rostov-on-Don on the Sea of Azov, today makes combines, forage harvesters and tractors. — Glacier FarmMedia Network

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After consolidating its U.S. manufacturing this summer into one plant at Willmar, Minn., about 140 km west of Minneapolis, the company said Thursday it will also halt production at Willmar in early 2021.

Buhler, which also has Canadian plants at Winnipeg and Morden, Man. and Vegreville, Alta., said Thursday the Morden plant “will now be the primary source of Farm King production” and other product lines now made at Willmar.

Buhler’s Farm King product lines include include augers, mowers, bale carriers, snowblowers, compact implements and tillage tools. The company’s other product lines include Versatile tractors and sprayers.

The company described the Morden plant, about 110 km southwest of Winnipeg, as “one of the original and most efficient Buhler Industries factories.”

Relocating the U.S.-made Farm King product lines to Morden this winter “will optimize output at that facility while capitalizing on the fluctuations in the exchange rate,” Buhler said.

In its third-quarter financials in August, Buhler had said it faced “unpredictability in the agriculture commodities market and fluctuations in the exchange rate, as dealers in Canada market several U.S.-based Farm King-branded products.”

Farm King dealers in Canada and the U.S. “will not experience delays in delivery of whole goods or service parts” as a result of the move, the company said Thursday.

Buhler has operated at Willmar since 2011, when it bought an existing 135,000-square foot facility and set up production lines there for Versatile sprayers and Farm King application equipment.

Other Farm King work was moved to Willmar this summer as the company wound down operations at its Fargo, N.D. plant and shut the latter facility in late September.

Shutting the Willmar operation also follows “further analysis of trends in agriculture and manufacturing,” Buhler said.

Following a run of four straight quarterly net losses, Buhler in August reported a small Q3 profit of about $462,000 on $76.6 million in sales for its third quarter ending June 30, up from a $1.17 million net loss on $64.1 million in sales in the year-earlier period.

The increase in sales stemmed from a “strong return to the U.S. market,” Buhler said at the time, while sales into Canada and Eastern Europe “remain below historical levels.”

Buhler, majority-owned by Russian harvest equipment maker Rostselmash, said in August it has made “improvements in manufacturing efficiencies,” but found “competitive pressures have led to reduced gross margins.”

Losses on foreign exchange and “decreased gain on the sale of surplus assets” have offset its cuts in research and development spending and lower interest costs, the company said.

The ongoing COVID-19 pandemic “will continue to have an impact on the company as farmers, dealers and governments work through the next stages,” Buhler said, but added management couldn’t provide guidance on that impact. — Glacier FarmMedia Network

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The Winnipeg company, whose product lines include Versatile tractors and sprayers and Farm King application, tillage and hay equipment, said Monday it’s “optimizing” its U.S. production to boost efficiency and cut overhead costs at its factory at Willmar, Minn., about 140 km west of Minneapolis.

To do so, the company said the manufacturing now done at Fargo will be relocated to Willmar over the summer, and it will “cease” production at Fargo effective Sept. 30.

Buhler, which also has Canadian plants at Winnipeg and Morden, Man. and Vegreville, Alta., has operated at Willmar since 2011, when it bought an existing 135,000-square foot facility and set up production lines there for its Versatile self-propelled sprayers and Farm King application equipment.

The Fargo plant and warehouse, which today employ about 35 people working on various Farm King product lines, have been owned by Buhler since 2002.

That’s when Alloway Industries, a joint venture between Deere and Co. and Woods Equipment Co., dissolved and the partners sold off their manufacturing site and its equipment.

Consolidating operations at Willmar is expected to “reduce excess manufacturing capacity and will enable the company to remain competitive without compromising quality,” Buhler said in a release.

The company said its decision stems from “unpredictability” in ag commodity markets and flux in the Canada-U.S. exchange rate, as Buhler’s dealers in Canada market several of its “U.S.-based” Farm King-branded products.

Buhler in February booked a net loss of $5.45 million on $49.24 million in revenue for its first quarter ending Dec. 31, down from a $4.44 million loss on $57.33 million in revenue in the year-earlier period.

The company at the time cited “trade uncertainties, bad harvest conditions and poor crop yields” as well as low commodity prices for the drop in revenues. Q1 sales were “below historical levels” in Canada and Eastern Europe, while U.S. sales had “return(ed) to historical levels” for the period. — Glacier FarmMedia Network

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Citing “depressed” sales due to “weak” commodity prices, the Winnipeg company on Thursday booked a net loss of $4.4 million on $57.3 million in revenues for its first quarter ending Dec. 31, down from a $5.8 million loss on $74.6 million in its year-earlier Q1.

Buhler, the maker of Versatile tractors and Farm King implements, said it already expects its sales in fiscal 2019 to come in below its 2018 level of $288 million.

However, it said Thursday, it also aims to “significantly reduce its losses in 2019 as it focuses on margin improvement.”

Specifically, Buhler said it has “already reduced overhead costs at the beginning of the year through staff reductions and other cost-cutting measures.”

The company also noted a US$5 million (C$6.62 million) loan from its controlling shareholder during the quarter.

That shareholder, Russian ag equipment maker Rostselmash, is “willing to provide financial support until profitability improves,” Buhler said.

Buhler also reiterated Thursday it plans to start shipping its new 170- to 250-hp tractor platform early in fiscal 2019, following “significant investments in product development over the last few years.” — Glacier FarmMedia Network

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The Winnipeg-based company, which makes Versatile tractors and Farm King implements, on Friday booked year-end net income of about $500,000 on gross revenue of $312 million, up from a $2.7 million loss on $274.1 million in sales in 2016.

“Orders in North America have returned to near historical levels, with the company seeing an increase in sales to the United States,” the company said in a release.

Buhler, which since 2007 has been majority-owned by Russian combine manufacturer Rostselmash, also noted Friday its sales into Eastern Europe “remained steady” in 2017. The Winnipeg company sells into Russia, Ukraine and Kazakhstan through Rostselmash’s dealer network.

Looking ahead, Buhler said its “sales for 2018 are expected to increase over 2017 results.”

Farm equipment demand in the U.S. is “slowly increasing,” the company said, as farmers “adjust to depressed commodity prices.”

Canadian sales are expected to remain steady, Buhler said, and its margins overall are expected to improve.

Increased revenue in 2017 was offset by more spending on research and development, interest expense and a loss on foreign exchange, Buhler said.

Its 2017 bottom line was also partly offset by a one-time $4.3 million gain it reported in fiscal 2016 on a sale of intellectual property and tooling from an “obsolete product line.” — AGCanada.com Network

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The Canadian company last Thursday booked a net loss of $2.7 million on $274.1 million in sales for its year ending Sept. 30, 2016, up from a $5.3 million loss on $245.7 million in sales in fiscal 2015.

Sales of the company’s Versatile Legendary Limited Edition tractors, produced last summer to mark 50 continuous years of four-wheel-drive tractor production, offset “weak commodity prices that continue to contribute to reduced sales levels,” the company said.

The Winnipeg firm, now owned mainly by Russian combine manufacturer Rostselmash, makes Versatile four-wheel- and front-wheel-drive tractors and Farm King implements and equipment such as augers, mowers, sprayers, front-end loaders and bale carriers. It launched a new vertical tillage tool under both brands last summer.

Buhler said its net loss on the year was due mainly to a decrease in margin, along with higher interest costs and research and development spending. Gains on the sale of surplus assets and foreign exchange helped offset those costs, the company added.

While the company’s year-to-date sales in North America, particularly in the U.S., have declined, it expects sales to increase “slightly” in 2017.

Buhler said it “continues to pursue increases in market share,” though lower commodity prices are expected to continue to drag on demand for farm equipment.

Looking ahead, margins are still expected to be “weak due to aggressive competition,” and inventory levels are expected to remain lower, Buhler said. However, the company added, profitability from operations is expected to increase due to its “cost reduction initiatives.”

Offsetting those cost cuts, however, is a weaker Canadian dollar, as many components and parts are paid for in U.S. dollars, the company noted. — AGCanada.com Network

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