By Tribune Staff
LARNED — Golden Valley Co-Op, Rozel, Mid State Farmers Co-Op, Rush Center, and Pawnee County Co-op Association, Larned, announced this week approval of a letter of intent by their boards of directors to proceed with merger discussions.
In a release dated Nov. 21, the boards approved the plan to proceed with merger discussions and began drafting a definitive agreement. The announcement follows several months of internal and independent analysis on the potential risks and benefits to the merger.
“This is an important decision for our respective cooperatives,” explained local farmer and PCCA board chair Kraig Froetschner. “Our boards and senior leadership believe we can unite our businesses to maintain local control in the business and achieve greater efficiencies. These three cooperatives share common values and complement each other perfectly from an asset and region perspective.”
“Our members own these cooperatives and we encourage our membership to read the merger details and reach out to board members with questions,” said local farmer and Golden Valley board president Kory Josefiak.
Members will receive information packets explaining merger details that have been discussed. The boards of directors, management and employees will be performing due diligence to identify all synergies and risks associated with a merger.
“Merging Golden Valley, Mid State and Pawnee County has the potential to create a sustainable cooperative for its members that allows for future growth opportunities,” noted local farmer and Mid State Farmers Co-Op board chairman Craig Jecha. “The increased scale leads to more efficient investments in assets, technology and people.”
Kansas law requires two-thirds of the votes cast in favor of the proposal for a merger to be accepted. The boards of directors for the three cooperatives will meet in December to review the definitive agreement and vote on whether to proceed. Should the merger go through, each cooperative will be represented by nine farmer-owners, with three each from the former boards. The combined cooperative will be temporarily headquartered in Rozel until permanent staffing needs are determined. A formal CEO selection process will take place upon a positive merger vote.
Based on the latest full fiscal year, the combined cooperatives’ agronomy, grain, energy and feed business would gross $187 million in sales, with $24 million in total assets. There would be 14 locations and 84 full-time employees.
