TAFE Enters Cooperation Agreement with AGCO Corporation (AGCO)
Key Summary: On September 30, 2024, TAFE issued an open letter to shareholders voicing concerns over the company’s governance, capital allocation, and operational issues. On February 11, 2025, TAFE criticized AGCO's poor financial performance, costly acquisitions, and integration issues, including a $354 million goodwill impairment and Seth Crawford’s departure. TAFE withdrew its shareholder proposal, citing AGCO’s resistance to governance improvements and calling for stronger board oversight. On March 24, 2025, TAFE (16.3%) announced it will not seek board nomination or reelection at the upcoming annual meeting due to ongoing talks to resolve litigation and other matters. On June 30, 2025, TAFE and the company signed multiple agreements, including a cooperation deal under which TAFE accepted voting and standstill restrictions while retaining certain rights in major events.
Market Cap: $7.1 billion | AGCO Corporation manufactures and distributes agricultural equipment and related replacement parts worldwide.
- On September 30, 2024, TAFE released an open letter to shareholders expressing concerns about the company’s governance, capital allocation, and operational issues. TAFE criticized the Board for ignoring its suggestions, leading to declining financial performance and market share in the agricultural machinery sector. It called for immediate reforms, including the addition of independent directors, the formation of a Strategic Transformation Committee, and separating the roles of Chairman and CEO for better accountability. Source
- On February 11, 2025, TAFE criticized AGCO’s poor financial performance and strategic decisions, highlighting long-term underperformance and costly acquisitions without returns. They pointed to undisclosed metrics and a $354 million goodwill impairment from the PTx Trimble acquisition, alongside the departure of Seth Crawford, suggesting integration issues. TAFE withdrew its shareholder proposal, citing AGCO’s resistance to governance improvements and calling for stronger board oversight. Source
- On March 24, 2025, TAFE (16.3%) announced that due to advanced talks with the company to resolve ongoing litigation and other matters, it has decided not to seek board nomination under the April 24, 2019 agreement, and its nominee will not seek reelection at the upcoming annual meeting.
- On June 30, 2025, TAFE and the company entered into multiple agreements, including a cooperation agreement, IP agreement, buyback agreement, arbitration settlement, and Indian litigation settlement. Under the cooperation agreement (effective upon procedural completion in India), TAFE agreed to voting and standstill restrictions, while retaining certain rights in case of major corporate events. TAFE will also maintain its ~16.3% stake by participating in buybacks and may engage privately with the Issuer on strategic matters.
Past
- On November 12, 2020, Tractors and Farm Equipment Limited (TAFE), holding 16.2% of shares, emphasized the importance of sound governance policies for effective Board oversight and shareholder value creation, advocating for the separation of the Chair and CEO roles to improve governance practices. TAFE expressed intentions to submit a stockholder proposal on this separation, reiterating its concerns on November 24 and again on December 4, stressing that it was essential for governance standards and Board independence during CEO succession. Source
- On February 17, 2021, TAFE's Ms. Srinivasan highlighted insufficient progress in refreshing the Board and called for the appointment of three new directors and a change in the lead independent director. By March 2, 2021, TAFE expressed deeper concerns about the company's weakening competitive position and reiterated the need for a comprehensive Board refresh through the election of independent directors with relevant expertise.
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