W. TERRY SMITH
Farmtrac North America was sold on the courthouse steps Monday for $14.1 million to Montana Tractors of Springfield, Ark.
After the successful bid, Judge Frank Brown confirmed the sale in Edgecombe County Superior Court.
Farmtrac has been in receivership since January when it laid off its 180 employees.
It appeared a month ago that the beleaguered Tarboro company would be sold to LS Mtron of South Korea, which made a $10 million offer.
Tarboro attorney Jim Marrow, the court-appointed receiver authorized to sell Farmtrac’s real and personal property, presented Mtron's offer to the court Oct. 20 and waited 10 days for any upset bids.
When Textron Financial Corp., the major lien holder to which Farmtrac owes more than an estimated $50 million, raised an objection, the judge extended the deadline for offers to Nov. 14 and scheduled the auction, if necessary.
Montana made an offer.
The bidding began with LS Mtron’s original $10 million offer and increased in $100,000 increments to $14 millon.
It took less than 30 minutes as a crowd of about 100 people, including former Farmtrac employees, watched on a chilly morning in the bright sunshine.
“That’s a very good price for these assets,” Marrow said. “Apparently Farmtrac is more valuable than people let on. I think it speaks well for the people who worked there.”
The sale, which is expected to close Dec. 1, includes all tractors, parts and the assembly plant at 111 Fairview St. off Main Street and the company store on West Northern Boulevard.
Montana’s plans for the plant are not clear. Vice chairman and co-owner Ted Wade was in Tarboro on Monday but left without making any announcements.
Marrow said Montana representatives were the first to show interest in Farmtrac “and came to see us in March, but nothing panned out.”
In December 2005, Montana bought 80.45 acres of land next to the Farmtrac company store on West Northern Boulevard for what was going to be the site of a new East Coast distribution center.
Montana Tractors, the 2007 Arkansas Business of the Year, was named after one of its owner’s – the late J.B. Hunt – favorite places to visit.
“Montana is open and rugged, and he wanted to provide a tractor that had that same image,” Wade said.
According to its Web site: “Montana Tractors imports tractors that are 80-85 percent assembled by their manufacturers in South Korea and Romania. Its employees add the tires, loaders and Montana name and distribute them to dealers ready to sell to customers Wade described as ‘hobby farmers.’
“These utility tractors are not suitable for large commercial farming, but they are ideal for the weekend farmer or the family that needs to maintain a 5- or 10-acre home site.”
LS Mtron Ltd. is formerly LS Cable, which reorganized earlier this year. LS Cable was one of the two suppliers of basic units for Farmtrac and is owed $11.6 million. Earlier this year, LS Cable purchased Superior Essex, which has a facility in Tarboro.
At the time of the appointment of the receiver, Farmtrac was insolvent and its property was encumbered with mortgage and other liens securing Textron Financial Corp.
According to court documents, the six-decade old tractor manufacturer has more than $55 million in total liabilities.
Since Farmtrac closed its doors and Marrow was appointed receiver, the tobacco barn division was sold to Richard C. Anderson of Leggett and Robert H. Pope of Rocky Mount for $650,000 and a salvage auction in April raised $340,000.
Marrow said most of the money from the barn sale went to Textron.
Created by North Carolina native William Redden "Bill" Long II in 1941, Tarboro-based Long Manufacturing prided itself on high quality tractors and dependable customer service.
Long established contracts with numerous major companies, including Ford, by the mid 1950s and opened satellite stores in Iowa, Pennsylvania, Tennessee, Georgia and Washington state.
It began importing tractors from Brasov, Romania-based Uzina Tractorul Brasov and filed for bankruptcy in 1985, but returned by 1987 after reorganization.
In 1998, Long Agribusiness was purchased by the Escorts Group of Faridabad, India; a leading engineering conglomerate that focuses on agri-machinery, construction and material handling equipment, railway equipment and auto components.
The Long name was dropped in favor of the Farmtrac brand.
Farmtrac sold more than 3,300 tractors in 2005, 2006 and 2007.
