AgJunction in Hiawatha is preparing for a merger with a California company that could bring exciting growth.
Last month, AgJunction announced it will be acquiring the Silicon Valley company, Novariant, through a merger transaction. Company officials say the acquisition will require a shareholder vote and hope the merger will be complete by the end of summer.
Current CEO Rick Heiniger will be assuming the role of senior advisor to the CEO, while Dave Vaughn, current CEO of Novariant, will take over as CEO of AgJunction. Heiniger said he will remain involved with AgJunction management.
When Heiniger started the company in 1980 in the garage of his Fairview home, he had no idea that one day it would grow to become a worldwide leader in precision agricultural steering. By 1985, he had established RHS Fertilizing and Spraying at a facility located near the water tower on the west end of Hiawatha. He merged with Rockey Manufacturing, a local company owned by brothers Paul and Phil Rockey that manufactured sprayers.
The business continued to grow and was featured in the INC. 500 twice. By 1995, RHS purchased Bestway from Ritchie Industries in Conrad, Iowa and that company was moved to Hiawatha. Then a shift toward precision guidance and GPS created a new division, Outback Guidance. A few years later, Outback became affiliated with Satloc and ultimately merged to become Hemisphere GPS. About this same time, Hemisphere GPS expanded and moved from the original buildings on West Iowa Street to the new building, which was once the original Walmart, after a major renovation. It was at this time that Outback split with Bestway, which remains at its location on West Iowa Street. In January 2013, the headquarters were moved from Calgary, Alberta to Hiawatha and a new leadership team was established, along with a business name change to AgJunction.
Heiniger and Jeff Farrar, vice president of sales, give credit to the City of Hiawatha and the Hiawatha Foundation for Economic Development for its support that allowed the company to expand to the old Walmart facility on the west end of town. The purchase of the original building shell facilitated by the city and HFED where over a period of time the company was required to grow to the tune of five employees each year for five years. The goal was achieved and much more.
Once the merger with Novariant is complete, the corporate office will be in California. Heiniger said there is a definite prestige for a technology company to have a Silicon Valley address, but assured the bulk of work that AgJunction does will continue to be completed from the Hiawatha location. The Hiawatha location is focused on accounting and finance, IT, human resources, product management, customer and technical support, quality, purchasing, inventory management, repair, global distribution and sales.
“There are no proposed decreases here,” Heiniger added. “If anything, we will grow.”
AgJunction currently has 64 full-time positions in Hiawatha with more than twice that through all its locations. The company is currently advertising to fill four positions in Hiawatha and Heiniger said he anticipates new openings to develop in the future as the company continues to grow due to the merge with Novariant. Farrar said roughly a third of the AgJunction employee base is made up of engineers. Other locations include Scottsdale, Ariz., Brisbane, Australia, Winnipeg, Manitoba (Canada) and soon Fremont, Calif., with the merger of Novariant, which comes with 55 of its own employees.
“The core of our business is automatic steering,” Heiniger said. “It has evolved some through the years, but has been very focused.”
The acquisition of Novariant will allow AgJunction an even more premiere name in the field of automated steering technology in agriculture. Heiniger said the precision steering is becoming so advanced that the integrated systems AgJunction develops enables true precision farming to occur. Farrar said that Novariant offers technology very similar to AgJunction with a customer base that is complementary, along with a strong patent base. By combining, the intent is to become No. 1 globally in the field of automatic steering.
“We know we won’t be the only one, but we want to be No. 1,” Heiniger said. “With this combination, we can achieve that goal. We have such an opportunity ahead of us.”