This Week In Ag #90

The year was 1984. It was totally awesome. Ronald Reagan had just carried 49 states to win re-election. Purple Rain reigned over the air waves. Daniel-san had defeated Cobra Kai (well, for the first time). Steve Jobs introduced a little beige box that would soon change the world. Yet in farm country, one news item dominated all conversations from turnrows to coffee shops: Case buys International Harvester. Well, they sort of did.

Tenneco already owned Case. In a move to boost their ag footprint, Tenneco acquired an industry icon. IH loyalists were in disbelief. Many were livid. Others in sheer panic. How could this be? How could those ugly white-on-top-orange-on-the-bottom tractors – the butt of so many jokes – now own Big Red? The company whose founder, Cyrus McCormick, invented the modern-day combine. A brand rivaled in loyalty and prestige by only John Deere. This was akin to RC Cola buying Pepsi. For those who bled green, it provided fodder for more laughs than an episode of Cheers. Truth be told, IH was bleeding money in the mid 1980s due to the farm crisis. By today’s standard, the rumored $420-480 million purchase seems like a steal. But IH lost over $2.2 billion over the two prior years and had already restructured their debt three times that decade. The move ushered merger-mania within the farm industry and became another symbol of 1980s business culture. Tenneco’s ag division emerged as Case International.

While it was a rocky start, all became well a few years later with the launch of the famous Magnum tractor. This was the first combined creation of the merger, offering breakthroughs in styling, comfort and the first full powershift transmission. In 1994, Tenneco exited the farm sector, a public offering formed the Case Corporation, and with it, the Case IH brand.

I was working on the business at a marketing firm at the time. I was sworn to secrecy while creating a launch event for their North American dealer meeting. I’ll never forget the deafening roar and tears of glee from the crowd when during our opening video they watched the word Case slide in from the left of the screen and met with the letters IH arriving from the right side of the screen to form the new Case IH brand identity. A huge part of our business was collateral development. We’re talking automotive-quality brochures with Detroit-style photography shot from lift cranes and helicopters. Immediately after the sales meeting, we were charged with revising all photos in current collateral, stripping out Case International for Case IH. While those revisions may sound simple enough today, they were anything but back in those days. Meanwhile, Case IH’s days of merging didn’t end when leg warmers and the multi-layering of Polo shirts did. In 1999 the company would be purchased by Italian automaker Fiat, which owned the New Holland brand of farm and construction equipment. The company is now CNH Industrial.

This month marks the 40^th anniversary of ag’s most infamous merger. People often recount exactly where they were during defining historical events: JFK’s assignation, the Challenger explosion, 9-11. For this Illinois farm boy, it was in my parent’s basement, the social hub of news and gossip on Rural Route 3, where a group of stunned farmers – owners of red, green and those in between – gathered to not only process what just happened, but ask “what’s next?”