Two regional cooperative mergers took effect on Sept. 1, while a third was recently voted down by members. In the Pacific Northwest, Valley Wide Cooperative in Nampa, Idaho, and Ag Link Inc. in Reardan, Wash., officially merged on the first of the month. And in Iowa, Alceco in Albert City completed its merger with First Cooperative Association (FCA) in Cherokee.
Valley Wide and Ag Link announced in July that members of both organizations had voted in favor of unification, with Ag Link’s seven Washington locations joining Valley Wide’s growing footprint in the region (GM July 16, p. 1). Ag Link had operated under that name since 2006, offering fertilizer, crop protection products, and fuels and lubricants from northeastern Washington locations at Almira, Coulee City, Davenport, Dayton, Edwall, Reardan, and Wilbur.
With more than 1,200 members, Ag Link posted $95 million in sales in 2020, with approximately $20 million coming from agronomy and $75 million from energy products and services. Valley Wide offers agronomy, feed, fuel and propane, and farm supply products and services to more than 60 communities in Idaho, Wyoming, Utah, Oregon, and Washington. The company’s operations include 24 agronomy locations, 18 retail stores, 15 propane plants, and a feed center. Total Valley Wide sales in 2020 were $500 million.
Both organizations said locations, management, crop advisors, and energy reps will remain the same, but former Ag Link customers will now have access to more precision agriculture tools, proprietary custom-blended crop inputs, and expanded service and online buying options. The Valley Wide board has expanded to 12 with the completion of the merger, consisting of three members from the existing Ag Link board and nine from the existing Valley Wide board.
The merger between Alceco and FCA was first announced in December (GM Dec. 18, 2020), with Alceco members voting in July to approve the unification (GM July 23, p. 1). The combined organization is headquartered in Cherokee under the FCA name, with a home office remaining open in Albert City. The merged co-op now operates a total of 32 Iowa facilities offering agronomy, energy, grain, and feed products and services.
FCA is recognized as the oldest continuously active cooperative elevator in the nation, tracing its roots to 1887. FCA was formed under its present name in 1997 through the merger of four Iowa cooperatives – Farmers Cooperative Association in Marathon, Agland Coop in Alta, Farmers Cooperative in Aurelia, and Farmers Cooperative in Cleghorn.
Alceco, which stands for Albert City Elevator Cooperative, was formed in 1905, but grew over the decades through multiple expansions and acquisitions, including a merger in 2008 with Midwest Farmers Cooperative. Alceco partnered with Cargill in 1997 to form Ag Partners LLC, a joint venture that provides grain, agronomy, feed, and petroleum products and services from 17 retail and wholesale locations in Iowa. Alceco acquired full ownership of Ag Partners last year (GM July 31, 2020), and the company now operates as a solely-owned subsidiary.
Ag Partners CEO Troy Upah has been named as CEO of the combined cooperative, with Merle Lyons, FCA’s former General Manager, serving as Chief Operating Officer.
A third merger proposal in Iowa that was announced earlier this year between Farmers Win Co-op in Fredericksburg and Five Star Cooperative in New Hampton (GM Feb. 12, p. 1) failed to win the support of a sufficient majority of Farmers Win members, the companies announced on Aug. 23.
According to a statement from Farmers Win Board President Dwane Koch and Five Star Board President Tom Shatek, 70 percent of Five Star voting members returned ballots with a more than two-thirds majority supporting the merger, meeting Iowa’s legal threshold for the merger to succeed. Some 60 percent of Farmers Win voting members returned ballots, but only 60 percent supported the merger, falling below Iowa’s 66.67 percent legal threshold.
Koch and Shatek said the voting process was marred by mail delays that required new ballots to be sent to some members, but enough votes were received from both co-ops to satisfy Iowa requirements that at least 50 percent of voting members submit ballots. Farmers Win board members reportedly met in late August to discuss the next steps to be taken, if any. The topic will also be discussed at the upcoming annual meetings in September.
“It has been a two-year process of discussions with both boards and employees to get to this point, and your Directors went through an intense discovery and due diligence time to make sure that both co-ops would work together to increase the value and strength of our co-op,” Koch and Shatek said in the statement.