US-based agricultural equipment giant John Deere & Co. has announced it will acquire Israeli cotton picking machinery manufacturer, BHC.

John Deere & Co. has made a tentative offer to buy an Israeli firm that manufactures cotton picker repair parts for all makes of equipment. Although the terms of the deal were not made public, Deere reportedly agreed to pay Kibbutz Beit HaShita $13 million for its agricultural equipment and machinery factory, BHC. The kibbutz is located several miles southwest of the Kinneret (Sea of Galilee).

BHC Manufacturing also supplies cotton picker row units for other equipment manufacturers and employs approximately 110 workers.

Demand for the machinery dropped during the recent world economic crisis, leaving an opening for Deere, the third-largest agricultural equipment manufacturer in the world.

Deere said the deal was conditioned on BHC’s “satisfactory completion of due diligence” in the second quarter of 2010. Company officials said they expect to complete the review process in the firm’s second fiscal quarter, which runs from February through April.

The acquisition would allow the U.S.-based heavy equipment maker to expand its range of products and services in the cotton picker industry.

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According to Deere spokesman Ken Golden, the company would continue to run BHC as it is at present, supplying other manufacturers. Media sources said Deere would continue to employ at least 90 percent of the workers for at least a year, and made a commitment to keep a minimum of 75 percent of the workers for an additional two years.

Deere, which is based in Moline, Illinois, offers products and services for agriculture, forestry, construction, lawn and turf care, landscaping and irrigation. If the acquisition goes through, it would be the second purchase of an Israeli company since June 2008, when Deere announced its purchase of Plastro Irrigation Systems Ltd.

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