Winnipeg, Manitoba
November 17, 2006
Open letter to
Agricore United
customers:
On November 7th, 2006, Saskatchewan Wheat Pool (SWP) announced
through the media its intent to take over Agricore United
through a share exchange. They are calling it a merger. It
isn't. It is a hostile proposal.
We know the difference. A friendly merger includes open dialogue
between both parties, exchange of information to determine fair
value for both sides and ironing out important issues such as
Competition Bureau concerns prior to making an announcement.
We have had no conversation with SWP on this proposal. So far,
we have only an announcement of an intention to make an offer
and very few details.
There are two things you need to know now. The first is that
there is a long process ahead once we actually receive the offer
including careful review by our Board of Directors on behalf of
shareholders and other stakeholders, as well as review by the
Competition Bureau. The second is that, in the meantime, nothing
will distract us from serving our customers and running
our business.
The timing and intent of the hostile proposal is not a surprise
- SWP clearly wants to be part of our growing momentum and take
a piece of our success. Agricore United is Canada's largest
grain handler and a leading provider of crop inputs to our
farmer customers. We are a global agri-business with customers
in over 50 countries. We are Canada's largest exporter of canola
- a crop that now rivals wheat in its economic importance. Our
grain merchants work in 12 languages; we operate offices in
Tokyo and the United States.
We're a company that both farmers and investors can trust. We've
proven we can manage through extremely tough times. We promised
at the time of the
2001 merger that we would pay down debt while continuing to grow
as a company. We've done that and we're continuing to do that,
while at the same time regularly issuing dividends to our
shareholders. We promised to look for economies of scale that
would benefit our customers. With our strategic alliance with
various seed and chemical companies, we are delivering on that
promise as well.
During the past year the Agricore United board of directors, 12
out of the
15 of whom are elected farmer members, and senior management
team went through an intensive strategic planning process. We
have a very clear direction of where we're heading as a company,
which we have distilled down to a single sentence: Agricore
United's overall strategic intent is to grow by adding value to
agricultural production.
We intend to stick to this path. When we say "it is business as
usual at Agricore United" what we really mean is "we're going to
continue providing our customers with the best service, products
and agronomic advice possible, now and long into the future."
Through our heritage companies, Agricore United has been around
for 100 years and our values continue to be solid.
Our word is our bond. We promise to keep you informed as we work
our way through what we expect to be a long process.
Yours truly,
Wayne Drul
Chair
Agricore United
Brian Hayward
Chief Executive Officer
Agricore United
RELATED LINKS:
-
Agricore United
appoints special committee to evaluate hostile share-exchange
offer
- Agricore United
responds to Saskatchewan Wheat Pool announcement
-
Saskatchewan Wheat Pool to make offer to Agricore |