I live in Southern Indiana and the local Deere dealer here sells LNN irrigators. A few other dealerships that I know of in area also sell LNN. I recently traveled to Nebraska and was surprised to see that the dealership near Falls City NE also sells LNN. My thought would be why wouldn't Deere just buy out LNN and make it a part of their total package to farmers? The irrigators could be integrated into the same platform as the GPS systems in the tractors and they have the JD financing that farmers could take advantage of. Does anyone on board see why this would not make sense? I own both Deere and LNN and come from a farming background. It would seem a perfect fit to me. I'm not really interested in thoughts about mkt cap of LNN or what Deere would have to pay...I know that answer. Thoughts appreciated.
IMO LNN will be a good suitor for a bigger company...someday (Deere, VMI, related ag company)
Probably in the next 2 to 5 years.
When the economy improves and hits on all cylinders, the offer comes along.
The companies looking forward would buy when the shares are lower.
In the meantime, expect LNN to have wild price swings on daily trading.
Wonder why this is happening, with good earnings, but share price off its 52-week highs.
With their PE down to a "normal" level (it used to be stratospheric) I agree they will eventually be purchased. Not by Valmont, as that would not likely pass the anti-monopoly test, and combining the dealer networks would be a nightmare. Unlikely it will be Deere for the reasons I provided in this thread. But someone will buy them. Eventually. Right now commodity prices are off their highs from a year ago, and the stock is tracking down in anticipation of a weaker sales season. A smart buyer would wait for commodity prices to bottom, and buy the company on the upswing.
Irrigation dealers need to be close to their users as they have to make field service calls on very short notice. If they have huge territories, there is a lot of unproductive windshield time. The irrigation dealer model is many small dealerships blanketing water-rich areas. I worked for Valmont, and we had a few Deere dealers carrying our line as well -- they were habitually lower quartile performers, particularly when it came to field service. Independent irrigation dealers generally performed much better than anyone else (including our own company owned dealerships). I suspect that if Deere bought Lindsay, sales would crash. Independent Lindsay dealers would look for a new manufacturer to represent, and many Deere dealers would require significant persuading to aggressively sell the line. One of those situation where the synergies would be outweighed by the anergies, in my opinion.