CHS and West Central Ag Services, a cooperative based in Ulen, Minn., with nine agronomy centers in northwestern Minnesota, have signed a nonbinding letter of intent for West Central to join CHS to better serve owners and customers and position the co-op for future growth.
“Our two cooperatives are aligned in our vision to advance the cooperative system and best serve our owners by connecting our producers to the global marketplace,” says Duane Brendemuhl, West Central Board President and Chair. “This proposed transaction provides an opportunity to bring more value to our farmer-owners and compete more effectively with other local ag companies, while positioning us for the future success of a combined cooperative through efficient, globally connected supply chains.”
CHS said the proposed transaction aligns with strategic investments for CHS to grow the global agricultural supply chain while providing end-to-end value and enhanced market access for the cooperative system. CHS and West Central are already partners in an agronomy joint venture based in Hannaford, N.D. (GM Dec. 9, 2010).
“CHS and West Central Ag Services have a longstanding, strong relationship based on mutual trust and respect, as evidenced by our joint venture Central Plains Ag Services,” said Rick Dusek, Executive Vice President of Ag retail, Distribution and Transportation at CHS. “Better connecting the global agriculture supply chain and investing in the speed and space of our assets provides better market access and creates more value for farmer-owners.”
CHS and West Central Ag said they will now begin due diligence on the proposed transaction, which is subject to necessary approvals.