On Aug. 17, West Central Cooperative announced they had signed a letter of intent to pursue a possible merger with Farmers Cooperative Company of Ames. Since that time, they have had outside consultants conducting due diligence, and West Central staff, including CEO, Milan Kucerak, have been out in the field talking with members. They have hosted over 20 question and answer sessions for stockholders across the region, wrapping up the initial round of meetings last Friday in Audubon and Irwin. Kucerak said there were several common questions raised, with the most frequent centered around a lack of competition with the merger. Those are very valid questions, he said. On the grain side, there are two areas of competition, ethanol and feed. On the agronomy side, they have looked at every FCC and West Central location and have found at least one strong competitor within 10 miles of each.
He said combined, they are looking at better procurement opportunities and better pricing. Some of the questions asked, however, could not yet be answered.
He said over the next two months, they will get a better feel for the answers to those questions. But combined, they would have 170 million bushels of licensed warehouse space for grain and expanded logistical options that would generate fuel savings. These two alone could result in significant savings, and it goes well beyond that.
With the conclusion of the member meetings, the consultants will continue to work with staff to put numbers to the savings and efficiencies they believe exist with the merger. Kucerak said, the goal is to have this completed by the November board meeting so they can review the advantages and disadvantages and decide whether or not to take the merger to a member vote. If they decide to take it to a vote, another round of member meetings will be scheduled.
The communication is so important Kucerak added, because quite frankly, if the members and employees don’t see the advantages of a unification, it just doesn’t make sense to do it.
