Monday, August 17, 2015
Dear Valued Patron,
Today, the boards of directors at West Central® Cooperative and Farmers Cooperative Company (FC) signed a letter of intent to analyze the merits of unifying our cooperatives.
Following discussions between each cooperative’s CEO and executive board committees, which began this spring, the letter of intent (LOI) showcases each cooperative’s intent to officially discuss a unification and outlines the process for doing so.
We are entering the due diligence phase where the cooperatives will analyze specific opportunities, cost savings and efficiencies potentially gained through unification. When due diligence is complete, the respective boards will determine whether or not to ask the membership to vote. Should both boards decide to proceed, a unification agreement would be structured requiring that the members of both FC and West Central vote.
Both FC and West Central are financially stable, sound companies. We recognize we must continue to serve your operation’s needs in order to remain relevant in a global supply chain and to protect your investment by strengthening our cooperative and adding value.
Based on early discussions, we believe a unification would allow us to do more together than we could do individually such as the following:
- Diversify the businesses: Each organization brings unique strengths to the table. 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 its SoyPlus® manufacturing plant.
- Improve productivity: Sharing resources to be more effective may allow us to better deploy assets like application equipment, rail access, and truck logistics, etc., which may reduce costs and allow us to better serve customers.
- Strategically channel capital: Together, we could target larger, more substantial investments to benefit members. We would aim to better deploy member resources and in turn, improve our services.
- Keep and attract talent: We believe the opportunities in a combined company would provide more consistent, value-added customer service.
An important part of the due diligence process is hearing from you. Beginning the week of September 14th, we will host a series of member meetings to offer company updates and discuss the upcoming pre-unification process. A list of meetings for each organization will be included in our upcoming newsletter. You are welcome to attend whichever informal meeting works best for your schedule including meetings hosted by either company. We look forward to hearing your thoughts on a potential unification of our two companies.
In the meantime, attached is a list of questions and answers we anticipate you may have. We also invite you to learn more about each organization and this process by logging in to your online customer account at fccoop.com or west-central.com and then clicking on the link for the unification information site inside the secure customer area. The site will include meeting dates, times and locations as well as FAQs and ongoing updates.
We look forward to seeing you this fall at one of our meetings and talking more about this process. We are excited about the potential a unification could bring to you and your cooperative.
President & CEO West Central 515.370.4298 email@example.com
Board Chair - West Central Board of Directors 515.370.0232 firstname.lastname@example.org