Farmers Cooperative Company (FC) and West Central Cooperative this week announced a unanimous vote by their Boards of Directors to proceed with a merger vote by members of both cooperatives.
Following several months of internal and independent analysis on the potential risks and benefits associated, the Boards approved the plan of merger and recommend a merger.
"Our members own these cooperatives. We encourage each owner to read the plan of merger and proposed articles of incorporation, ask questions, and return their ballot," said FC board president and Odebolt-area farmer, John Scott. "Every member matters."
"This is a landmark decision for our member-owners," explained West Central board chair and Paton-area farmer, Sue Tronchetti. "Our Boards, management and employee teams believe we can diversify our businesses, improve member services and protect and enhance member patronage by utilizing our scale to procure more efficiently."
Members are invited to hear presentations and information on the merger at one of 20 member meetings hosted Nov. 30-Dec. 11, 2015. A list of meeting locations and member resources are available online at wccgrow15.com or fcgrow15.com.
"By merging FC and West Central, members would truly have an ownership stake in every step of the value-added supply chain," noted West Central president and chief executive officer, Milan Kucerak. "Whether it's branded seed, faster grain assets, or value-added corn and soybean processing, a combined cooperative is better positioned to weather market volatility, directly access global markets, and offer more to its owners."
"We want to improve member service with better, faster assets sooner, and by retaining and hiring the best people," added FC chief executive officer, Jim Chism. "Most importantly, a merger allows us to maintain our commitment to serving our communities and keep profits local."
For a merger, Iowa law requires 50 percent of each membership to vote, with two-thirds of those votes cast to favor the proposal. Ballots and voting details will be mailed to each cooperative's voting members approx. Nov. 20, 2015. The votes will be counted at a special meeting slated for Dec. 18, 2015.
Should the membership approve the merger, each cooperative will be represented by nine farmer-owners and member equity will roll into the new cooperative on a one-for-one basis. The combined cooperative, to be headquartered in Ames, Iowa, will be led by Kucerak as chief executive officer.
In its last full fiscal year, Farmers Cooperative Company's agronomy, grain and feed businesses grossed $675 million in sales and had $292 million in total assets. FC has 414 full-time employees at 49 locations.
West Central's agronomy, grain, feed and dairy nutrition product line grossed $633 million and had $300 million in assets its last full fiscal year. The cooperative has 275 full-time employees in 24 communities.