WESTERN PRODUCER — Buhler Industries, parent company of the Versatile and Farm King brands, revealed in July it was searching for a “long-term investment partner.”
In late December, it announced that Turkish tractor manufacturer Basak Traktor, a wholly-owned subsidiary of ASKO Holding, was buying 96.7 percent of outstanding shares for $60.5 million.
“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, vice-president 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.”
Basak Traktor presented what was described as the most “well rounded” proposal.
“Basak Traktor, has several manufacturing facilities in Turkey,” Reid said. “They’re big in ag and construction equipment. They’re very passionate about that sector.”
Talks with Basak Traktor had been underway since early fall, according to Reid, who expects the deal will be completed in early January. All the roughly 24 million ownership shares to be acquired by Basak Traktor belong to Russian ag equipment manufacturer Rostselmash, which had been the majority owner until now.
The deal ends the involvement of a Russian company in Buhler’s ownership, which had been causing trouble for Versatile because of Russia’s 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 taken steps to publicly distance itself from its primary shareholder. In March 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 Basak acquisition, all board members must resign and will be replaced by those selected by the new owner.
Some of the brand’s dealers have expressed apprehension at the ownership change and what it might mean for the brand, but senior management, including Reid and chief operating officer Grant Adolph will remain in their current roles under the new ownership structure. That should help ensure consistency during the transition.
Reid said dealers and customers needn’t worry about the brand disappearing. Instead, he expects it to grow and expand.
“Sami Konukoglu, (chair of ASKO Holding) is extremely passionate about manufacturing, particularly agricultural manufacturing,” Reid said. “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 and He’s focused on the growth and expansion of the company.”
Supply chain disruptions during the last two years have caused problems with filling new tractor orders at Versatile because of persistent component shortages. The new ownership has said it would give the brand more purchasing power and should help it increase the number of tractors rolling off the assembly line.
It could also result in an expanded product line for Versatile, whose tractor offerings only go up from 175 horsepower.
Basak’s models run from 50 to 120 h.p., 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 Basak, that could change, although that is speculation at the moment.
Basak’s 5120 model, released in 2019, won an iF Design award. So the Turkish brand now produces models with features that could appeal to North American buyers.
“There could be some synergy in the long run,” said 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 said 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 Basak Traktor 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, given what they’ve been able to accomplish so far with their factory and vision they have for the Versatile, Farm King brands.”
