Monsanto Co., the world’s largest seed company, agreed to buy The Climate Corp. for about $930 million to provide farmers with weather data and farm modeling to help them boost yields and manage risk.
Closely held Climate Corp. was founded in 2006 by software engineers and data scientists who previously worked at Google Inc. and other Silicon Valley technology companies, St. Louis-based Monsanto said Wednesday in a statement.
Monsanto is building on its core business selling genetically modified crop seeds and associated herbicides, adding data to boost harvests through seed choice and pesticide timing.
Wednesday’s acquisition, the company’s largest in seven years, will be combined with last year’s $210 million purchase of Precision Planting LLC, which developed an iPad interface farmers use in their tractors to adjust planting rates.
“I like this deal,” Mark Gulley, a New York-based analyst at BGC Partners LP who recommends buying the shares, said by phone. “It’s big data meets big ag biotech. It’s a new platform for growth.”
Using “hyper-local weather monitoring,” predictive models and other data to help farmers make optimal growing decisions can eventually boost corn yields by 30 bushels to 50 bushels an acre, Climate Corp. CEO David Friedberg said Wednesday.
The company also helps farmers save money by avoiding badly timed pesticide use, he said.
Earnings in the fiscal year that began Sept. 1 will rise as much as 14 percent to $5 to $5.20 a share, Monsanto said Wednesday in a separate statement.
That trailed the $5.34 average of 22 estimates compiled by Bloomberg.
