Three regional cooperatives in Wisconsin – Cedar Country Cooperative in Elk Mound, Lakeland Cooperative in Ridgeland, and United Ag Cooperative in Almena – announced that they will merge on Oct. 1 following a successful member vote in April.
The new co-op, which has yet to be named, will have projected annual sales of $180 million and will cover a trade area stretching approximately 200 miles, from Ashland, Wisc., south to Eau Claire and Menomonie, Wisc. The consolidated company will also serve customers in Minnesota and Michigan’s Upper Peninsula.
“Economies of scale and the ability to purchase product at more competitive pricing was an important factor in the decision,” said General Managers Karl Varnes (Lakeland), Kyle Knutson (Cedar Country), and David Schoonover (United Ag) in a joint statement. “Each organization brings unique strengths to market. Improved asset utilization of trucks, equipment, and buildings will be a key objective. Operational efficiencies will be gained because of significant geographical overlap. A larger company will also offer improved employment opportunities for employees in an ever increasing and competitive workplace.”
The merger was approved by 64.5 percent of the voting members of each co-op, with a 50.1 percent majority required for the merger to proceed. Equity from each company will transfer dollar for dollar into the new company, and members will be eligible to have their equity paid out at age 68 wherever it was earned.
“A strong, local presence will be maintained in all communities we serve,” the businesses said. “Superior customer service has been a key to past success and will continue to be the focal point of the future. All three cooperatives are fortunate to have excellent employees which are important to future success.”
Each of the co-ops serves farmers in western Wisconsin with agronomy, grain, refined fuels, propane, and feed divisions. Convenience stores, tire and repair shops, and a farm equipment dealership will also be part of the combined co-op.
Cedar Country currently operates from locations at Menomonie, Boyceville, Elk Mound, Colfax, Strum, and Chippewa Falls. Lakeland has locations at Bonneville and Cold Lake, and United Ag operates at Almena, Ashland, Barron, Baldwin, Deer Park, Cameron, Cumberland, Frederic, Hertel, Turtle Lake, Shell Lake, and Trego.
Four directors from each company will be selected to sit on the board of directors. Board members will then determine the location of the main office and select a general manager/CEO for the combined business.
Wisconsin has been a hotbed of co-op merger activity in recent weeks. Greenville Cooperative in Greenville merged on April 1 with United Cooperative in Beaver Dam (GM March 31, p. 1). In addition, Country Visions Cooperative in Reedsville and Kettle Lakes Cooperative in Random Lake have announced plans to merge on Sept. 1 under the Country Visions name (GM April 21, p. 1), provided the merger proposal is approved by Kettle Lakes members in a June vote.