Boards of farmer-owned cooperatives unanimously approve process for due diligence, potential member vote.
(AMES, Iowa/RALSTON, Iowa) Aug. 18, 2015—The boards of directors at two of Iowa’s leading farmer-owned cooperatives today signed a letter of intent to study the membership benefits of a unification. The boards of Farmers Cooperative Company (FC), of Ames, Iowa and West Central® Cooperative of Ralston, Iowa have unanimously approved the first step towards a potential unification of the two companies.
“This letter of intent allows us to further explore equity, governance, organizational structure, asset investment and other member-focused efficiencies,” explained Sue Tronchetti, a Paton-area farmer and chairperson of the West Central board.
Both FC and West Central are profitable companies with strong balance sheets.
“In our first series of discussions, we have identified several opportunities that we believe will benefit our members today and for decades to come,” explained John Scott, an Odebolt-area farmer and president of the FC board of directors.
“We recognize we must continue to serve the needs of our members in order to remain relevant in a global supply chain and in turn, protect our members’ cooperative investment,” added Tronchetti.
“Our early discussions highlight opportunities to improve productivity by sharing resources to better deploy assets like application equipment, rail access and truck logistics,” explained FC chief executive officer, Jim Chism. “Being more effective in our execution would reduce costs and allow us to better serve customers.”
Chism added, “We believe the opportunities in a combined company would also provide more consistent, value-added customer service.”
“Each organization brings unique strengths to the table which we believe would further diversify our businesses,” said West Central president and chief executive officer, Milan Kucerak. “For example, FC has access to every major rail line in Iowa and West Central has built-in soybean demand for 20 million bushels annually at our SoyPlus® manufacturing plant.”
“In addition, by strategically channeling capital we would be able to target larger, more substantial investments to benefit members,” added Kucerak. “We aim to always better utilize member resources and in turn, improve our services.”
In coming weeks, the companies will host a series of employee and member meetings and conduct due diligence. Then, the boards will determine whether to take the unification proposal to a membership vote. Should the process move to a membership vote, both FC members and West Central members would vote.
Board chairs Scott and Tronchetti urged members to participate in member meetings during the due diligence phase to share feedback and concerns with management and the board. A list of meeting dates and locations is available online via each company’s website in the customer log-in section.
Alicia Clancy, West Central, (712) 667-3334; firstname.lastname@example.org
Laura Underwood, FC, (515) 817-2133; email@example.com
About Farmers Cooperative Company (FC)
Farmers Cooperative Company (FC) is headquartered in Ames, Iowa and is one of the largest farmer-owned agriculture cooperatives in Iowa. FC serves over 5,000 members in a trade territory of over 3,000,000 acres. Members are served from 46 locations by 400 full time employees. The FC mission is to improve the economic well-being of their members and customers by being a dependable, consistent and profitable provider of markets, products and services.
To learn more, please visit the website at fccoop.com or connect with us on the following social media sites: Facebook, Twitter, LinkedIn, YouTube.
About West Central® Cooperative
West Central® is a farmer-owned cooperative connecting producers of agricultural products to a vast network of processors and end-users around the world. The company manages for success by deliberately pursuing fresh ideas and recognizing value opportunities at every turn. Headquartered in Ralston, Iowa West Central’s agronomy, animal nutrition and grain businesses span 12 Iowa counties with locations in 24 communities.
To learn more, please visit west-central.com.