In one of the largest acquisitions of a construction equipment manufacturer in this industry’s history, Deere & Co. announced it will acquire the Wirtgen Group, a privately held German company it said was the worldwide leading manufacturer of road construction equipment.

The purchase price for Wirtgen’s equity is €4.357 (about U.S. $4.89 billion) in an all-cash transaction. Including the assumption of net debt and other considerations, the total transaction value is €4.6 billion (about U.S $5.167 billion). The Wirtgen Group had sales of €2.6 billion in 2016.

Deere expects to fund the acquisition from a combination of cash and new equipment operations debt financing.

The Wirtgen Group is headquartered in Germany. The company has five premium brands spanning the milling, processing, mixing, paving, compaction and rehabilitation segments of the road construction industry. Its product portfolio enhances Deere’s existing construction equipment offering and strongly boosts Deere as one of the worldwide leaders in global road construction.

“The acquisition of the Wirtgen Group aligns with our long-term strategy to expand in both of John Deere’s global growth businesses of agriculture and construction,” said Samuel Allen, Deere chairman and CEO. “Wirtgen’s superb reputation, strong customer relationships and demonstrated financial performance are attractive as we expand the reach of John Deere construction equipment to more customers, markets and geographies.”

“This transaction enhances our global distribution in construction equipment and enhances our capabilities in emerging markets,” added Max Guinn, president of Deere’s Worldwide Construction & Forestry Division. “Spending on road construction and transportation projects has grown at a faster rate than the overall construction industry and tends to be less cyclical. There is recognition globally that infrastructure improvements must be a priority and roads and highways are among the most critical in need of repair and replacement.”

The Wirtgen Group is highly advanced in technology and is expected to fit well with Deere, also strong in technological innovation. An analyst from William Blair told Reuters that the acquisition will help Deere diversify its business which had been very agriculture-focused, and will help grow its construction business especially outside of North America.

Deere said it plans to maintain the Wirtgen Group’s existing brands, management, manufacturing footprint, employees and distribution network. The combined business is expected to benefit from sharing best practices in distribution, customer support, manufacturing and technology as well as scale and efficiency of operations.

Deere’s board of directors has already approved the transaction. The purchase is subject to regulatory approval in several jurisdictions as well as other customary closing conditions. The companies said they expect to close on the transaction in the first quarter of Deere’s 2018 fiscal year.

Deere’s stock price, which has grown by more than one-third of its value in recent months, closed Thursday at $124.70 per share.

Citigroup was exclusive financial advisor to Deere; Linklaters LLP was legal counsel; the Boston Consulting Group was strategic advisor. Kirkland & Ellis LLP was securities legal counsel; and EY was accounting and tax advisor.

Wirtgen brands include Wirtgen, Vogele, Hamm, Kleemann, Benninghoven and Ciber.