AGCO Announces Closing of Willmar, Minnesota Facility; Additional Closings and Facility Rationalizations Also Announced

Apr 18, 2001, 01:00 ET from AGCO

    DULUTH, Ga., April 18 /PRNewswire/ -- AGCO Corporation (NYSE:   AG), a major
 worldwide designer, manufacturer and distributor of agricultural equipment,
 today announced that it will cease operations at its manufacturing facility in
 Willmar, Minnesota.  In order to achieve maximum rationalization opportunities
 from the recent acquisition of Ag-Chem, AGCO has made the decision to move the
 current production operations of the Willmar facility into the Jackson,
 Minnesota Ag-Chem facility.
     Current production at the Willmar facility includes the Willmar line of
 self-propelled sprayers, fertilizer spreaders, tenders and wheel loaders, as
 well as the Spra-Coupe line of self-propelled sprayers and the exclusive ESP
 (Energized Sprayer System).  The facility will be placed on the market for
 immediate sale once it is vacated.   AGCO's Willmar and Spra-Coupe brands will
 be retained and become part of the newly formed Ag-Chem Division, further
 capitalizing on rationalization opportunities in the areas of engineering,
 manufacturing and administration.
     In addition to the Willmar facility closing, AGCO has announced that the
 newly acquired Ag-Chem manufacturing facility in Benson, Minnesota and the
 administrative office in Minnetonka, Minnesota will also close.  Production of
 Ag-Chem's Lor*Al product line located in Benson will be relocated to Jackson.
 AGCO will also relocate the majority of Ag-Chem's engineering and
 administrative functions to the Jackson location.
     Employees at all affected locations were made aware of these developments
 in employee meetings earlier today.  Approximately 330 employees located in
 Willmar, Benson and Minnetonka will be impacted by the facility closures.
     "It is with sincere regret that we must make the decision to close these
 facilities.  We would like to extend our sincere thanks to all affected
 employees for their tireless effort, dedication and contribution," stated
 Robert J. Ratliff, Executive Chairman of the Board of AGCO Corporation.
     The rationalization of manufacturing, engineering and administrative
 facilities and functions is a portion of the expected synergies to be achieved
 from the Ag-Chem acquisition.  The Company has established a target to improve
 annual operating income by $30 million within two years as a result of these
 and other synergies.  The Company's preliminary estimate of the cash cost of
 closure and relocation of these facilities is between $10 and $15 million.
 The relocation of production and other functions is expected to be
 substantially completed in 2001. The transition process is in progress and no
 major disruption in production is expected.
     With the announcement of the Ag-Chem acquisition, AGCO has formed a new
 divisional organization and as previously announced Ron Hess will head up the
 Ag-Chem Division.  Mr. Hess has been named Vice President and General Manager
 reporting directly to John Shumejda, President and Chief Executive Officer of
 AGCO.  Mr. Hess will have full responsibility for all Ag-Chem North American
 operations.  Duluth, Georgia will become  the  general office  location  for
 the Ag-Chem Division.
     AGCO also announced that Ag-Chem's SOILTEQ Division will operate as a
 separate AGCO division under the direct supervision of Norm Boyd, Senior Vice
 President - Corporate Development at AGCO.  Mary Jetland of Ag-Chem will
 continue as Managing Director of the SOILTEQ Division, reporting directly to
 Mr. Boyd.  The SOILTEQ Division will remain in the Minnetonka office.
 
     Safe Harbor Statement
     Statements which are not historical facts, including cost reduction
 projections, production volume forecasts and industry demand outlook, are
 forward looking and subject to risks which could cause actual results to
 differ materially from those suggested by the statements.  Although the
 Company believes that the statements it has made are based on reasonable
 assumptions, they are based on current information and beliefs and,
 accordingly, the Company can give no assurance that its statements will be
 achieved.  The Company bases its outlook on key operating, economic and
 agricultural data which are subject to change including, but not limited to:
 farm cash income, worldwide demand for agricultural products, commodity
 prices, grain stock levels, weather, crop production, farmer debt levels,
 existing government programs and farm-related legislation.  Additionally, the
 Company's financial results are sensitive to movement in interest rates and
 foreign currencies, as well as general economic conditions, pricing and
 product actions taken by competitors, the success of its facility
 rationalization process, production disruptions and changes in environmental,
 international trade and other laws which impact the way in which it conducts
 its business.  Further information concerning factors that could significantly
 affect the Company's results is included in the Company's filings with the
 Securities and Exchange Commission.  The Company disclaims any responsibility
 to update any forward-looking statements.
     AGCO Corporation, headquartered in Duluth, Georgia, is a global designer,
 manufacturer and distributor of agricultural equipment and related replacement
 parts.  AGCO products are distributed in 140 countries.  AGCO offers a full
 product line including tractors, combines, hay tools, sprayers, forage
 equipment and implements through more than 7,750 independent dealers and
 distributors around the world.  AGCO products are distributed under the brand
 names AGCO(R)Allis, AGCOSTAR(R), Farmhand(R), FENDT(TM), Fieldstar(R),
 GLEANER(R), Glencoe(R), Hesston(R), Massey Ferguson(R), New Idea(R), Spra-
 Coupe(R), Tye(R), White Tractors, White Planters and Willmar(R).  AGCO
 provides retail financing through AGCO Finance in North America and through
 Agricredit in the United Kingdom, France, Germany, Ireland, Spain and Brazil.
 In 2000, AGCO had sales of $2.3 billion.
     Please visit our website at www.agcocorp.com.
 
 

SOURCE AGCO
    DULUTH, Ga., April 18 /PRNewswire/ -- AGCO Corporation (NYSE:   AG), a major
 worldwide designer, manufacturer and distributor of agricultural equipment,
 today announced that it will cease operations at its manufacturing facility in
 Willmar, Minnesota.  In order to achieve maximum rationalization opportunities
 from the recent acquisition of Ag-Chem, AGCO has made the decision to move the
 current production operations of the Willmar facility into the Jackson,
 Minnesota Ag-Chem facility.
     Current production at the Willmar facility includes the Willmar line of
 self-propelled sprayers, fertilizer spreaders, tenders and wheel loaders, as
 well as the Spra-Coupe line of self-propelled sprayers and the exclusive ESP
 (Energized Sprayer System).  The facility will be placed on the market for
 immediate sale once it is vacated.   AGCO's Willmar and Spra-Coupe brands will
 be retained and become part of the newly formed Ag-Chem Division, further
 capitalizing on rationalization opportunities in the areas of engineering,
 manufacturing and administration.
     In addition to the Willmar facility closing, AGCO has announced that the
 newly acquired Ag-Chem manufacturing facility in Benson, Minnesota and the
 administrative office in Minnetonka, Minnesota will also close.  Production of
 Ag-Chem's Lor*Al product line located in Benson will be relocated to Jackson.
 AGCO will also relocate the majority of Ag-Chem's engineering and
 administrative functions to the Jackson location.
     Employees at all affected locations were made aware of these developments
 in employee meetings earlier today.  Approximately 330 employees located in
 Willmar, Benson and Minnetonka will be impacted by the facility closures.
     "It is with sincere regret that we must make the decision to close these
 facilities.  We would like to extend our sincere thanks to all affected
 employees for their tireless effort, dedication and contribution," stated
 Robert J. Ratliff, Executive Chairman of the Board of AGCO Corporation.
     The rationalization of manufacturing, engineering and administrative
 facilities and functions is a portion of the expected synergies to be achieved
 from the Ag-Chem acquisition.  The Company has established a target to improve
 annual operating income by $30 million within two years as a result of these
 and other synergies.  The Company's preliminary estimate of the cash cost of
 closure and relocation of these facilities is between $10 and $15 million.
 The relocation of production and other functions is expected to be
 substantially completed in 2001. The transition process is in progress and no
 major disruption in production is expected.
     With the announcement of the Ag-Chem acquisition, AGCO has formed a new
 divisional organization and as previously announced Ron Hess will head up the
 Ag-Chem Division.  Mr. Hess has been named Vice President and General Manager
 reporting directly to John Shumejda, President and Chief Executive Officer of
 AGCO.  Mr. Hess will have full responsibility for all Ag-Chem North American
 operations.  Duluth, Georgia will become  the  general office  location  for
 the Ag-Chem Division.
     AGCO also announced that Ag-Chem's SOILTEQ Division will operate as a
 separate AGCO division under the direct supervision of Norm Boyd, Senior Vice
 President - Corporate Development at AGCO.  Mary Jetland of Ag-Chem will
 continue as Managing Director of the SOILTEQ Division, reporting directly to
 Mr. Boyd.  The SOILTEQ Division will remain in the Minnetonka office.
 
     Safe Harbor Statement
     Statements which are not historical facts, including cost reduction
 projections, production volume forecasts and industry demand outlook, are
 forward looking and subject to risks which could cause actual results to
 differ materially from those suggested by the statements.  Although the
 Company believes that the statements it has made are based on reasonable
 assumptions, they are based on current information and beliefs and,
 accordingly, the Company can give no assurance that its statements will be
 achieved.  The Company bases its outlook on key operating, economic and
 agricultural data which are subject to change including, but not limited to:
 farm cash income, worldwide demand for agricultural products, commodity
 prices, grain stock levels, weather, crop production, farmer debt levels,
 existing government programs and farm-related legislation.  Additionally, the
 Company's financial results are sensitive to movement in interest rates and
 foreign currencies, as well as general economic conditions, pricing and
 product actions taken by competitors, the success of its facility
 rationalization process, production disruptions and changes in environmental,
 international trade and other laws which impact the way in which it conducts
 its business.  Further information concerning factors that could significantly
 affect the Company's results is included in the Company's filings with the
 Securities and Exchange Commission.  The Company disclaims any responsibility
 to update any forward-looking statements.
     AGCO Corporation, headquartered in Duluth, Georgia, is a global designer,
 manufacturer and distributor of agricultural equipment and related replacement
 parts.  AGCO products are distributed in 140 countries.  AGCO offers a full
 product line including tractors, combines, hay tools, sprayers, forage
 equipment and implements through more than 7,750 independent dealers and
 distributors around the world.  AGCO products are distributed under the brand
 names AGCO(R)Allis, AGCOSTAR(R), Farmhand(R), FENDT(TM), Fieldstar(R),
 GLEANER(R), Glencoe(R), Hesston(R), Massey Ferguson(R), New Idea(R), Spra-
 Coupe(R), Tye(R), White Tractors, White Planters and Willmar(R).  AGCO
 provides retail financing through AGCO Finance in North America and through
 Agricredit in the United Kingdom, France, Germany, Ireland, Spain and Brazil.
 In 2000, AGCO had sales of $2.3 billion.
     Please visit our website at www.agcocorp.com.
 
 SOURCE  AGCO

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