MOSCOW — Russian Machines Corp., which is a part of Russia’s leading diversified industrial group Basic Element, and AGCO Corp., a leading global producer of agricultural equipment announce that they have completed a joint venture deal. The deal signifies the start of operations of “AGCO-RM” for production of agricultural equipment.

The strategic alliance will allow both companies to strengthen their position on the Russian agricultural machinery market, with the main goal being to achieve leadership through manufacturing localization, adoption of state-of-the-art technology developments and providing excellent service to the customer. Russian Machines Corp., one of the leaders in the Russian machinery sector, is contributing its manufacturing competencies and infrastructure while AGCO brings localization, distribution and the introduction of new products and technologies.

The joint venture started in March 2013 when Russian Machines and AGCO signed an agreement to establish mutually owned Russian manufacturing and distribution businesses. Since the agreement was signed and while competition approvals were being sought, the partners worked together on a contract basis for assembly operations at a 12.5-hectare manufacturing facility in Golitsyno, outside Moscow. Assembly of Challenger and Massey Ferguson branded tractors and harvesters is underway to be followed by distribution of assembled Fendt and Valtra branded products.

As a next step towards higher localization, the newly formed joint venture will begin assembling the popular Massey Ferguson 7347 and 7370 combine harvesters and Massey Ferguson 7000 and 8000 series tractors. These machines are expected to have more Russian-produced components.

Manfred Eibeck, CEO, Russian Machines:

“In partnership with AGCO, we are bringing to Russia advanced international technologies, broadening the RM product portfolio range and expanding our competencies in agricultural equipment production. The AGCO-RM joint venture has a huge potential for development enabling us to meet the demand in Russia.”

Rob Smith, senior vice president, general manager EAME for AGCO:

“AGCO continues to expand its presence in key global growth markets including Russia. The joint venture with Russian Machines Corporation will enable us to become a key provider of advanced Russian produced agricultural machinery and bring further efficient and productive solutions to local farmers in Russia.”