NEWS LINE
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CWT Round II removing
nearly 1-billion pounds of milk
Cooperatives Working Together
(CWT) — a dairy industry funded and
administered program to help better
balance milk supply and demand —
has accepted bids from 363 farms to
retire their dairy herds. These bids
represent 50,478 dairy cows, all of
which will be sold by the participating
farmers for beef. The cows being
retired produced 908 million pounds
of milk annually, or a little more than
0.5 percent of the 170 billion pounds
of U.S. milk produced in 2004.
“Our field auditors visited each of
the 378 farms we initially accepted into
the program,” says Jerry Kozak, president
and CEO of National Milk
Producers Federation, which manages
CWT. “We had excellent cooperation
from all the farmers, which allowed us
to complete our auditing process ahead
of schedule. That process screened out
a small number of bids that, it turned
out, didn’t meet our program’s criteria.”
The average bid accepted
in the second herd retirement
program was
$5.24/cwt, with no bid
accepted above $7.63. The
363 accepted bids were
selected from 736 submitted.
The 908 million
pounds of milk removed is
4 percent higher than
CWT’s initial goal of 870
million pounds. In the first
herd retirement program in
the fall of 2003, CWT
accepted bids from 299
farms that retired 33,000
cows representing 608 million
pounds of milk.
“This program is a winwin
for all of America’s dairy producers,”
Kozak says. “Producers who
wished to retire their herds are able to
do so through a bidding process that
assures they receive fair market value
for their milk production capacity,
while those dairy farmers who remain
in business will benefit because of a
better balance between supply and
demand.” Under CWT, farmers bid to
be paid for the volume of milk that
their herds produced, and also recover
the market price for those herds when
sold for beef.
Southern States Co-op acquires
Agway’s share of Co-op Milling
Southern States Cooperative Inc.
(SSC) is now the sole owner of
Cooperative Milling in Gettysburg,
Pa., following its acquisition of the 50-
percent interest Agway had held in the
business. The milling business produces
premium horse feeds under the
Triple Crown and Legends brands, as
well as other livestock feeds. SSC plans
to expand distribution of the mill’s feed
into New York and Connecticut.
Agway is now defunct, having
declared bankruptcy in 2002, while
SSC has been making marked progress
in restoring its operations back to fiscal
health after several years of losses.
Southern States has 300,000 members
and serves nearly 1,200 retail outlets in
19 states with agricultural inputs and
farm and home products.
Bio-energy priority for
USDA value-added grants
Agriculture Secretary Mike Johanns
has announced the availability of $14.3
million in grants that will support the
development of value-added agriculture
business ventures and support
President Bush’s energy plan to develop
alternative sources of renewable energy.
“The Bush Administration is committed
to working with rural farmers,
ranchers and entrepreneurs to increase
their economic opportunities, and to
create jobs that boost local economies,”
says Johanns. “These grants provide
America’s farmers and ranchers with
the investment funds needed to expand
their role in developing and marketing
value-added products.”
Priority consideration will be given
to those grant applications that have at
least 51 percent of project costs dedicated
to activities for a bio-energy project.
The renewable energy projects
involve biodiesel, ethanol or wind
energy production or the use of biomass
to generate energy. The funds are
provided through the Value-Added
Producer Grant program, administered
by USDA Rural Development. Grants
are available to independent producers,
agricultural producer groups, farmer
or rancher cooperatives and majority-
controlled producer-based business
ventures. They may be used to: (1)
fund planning activities needed to
establish a viable value-added marketing
opportunity for an agricultural
product (e.g. conduct a feasibility
study, develop a business plan, develop
a marketing plan), or (2) acquire working
capital to operate a value-added
business venture that will allow producers
to better compete in domestic
and international markets.
Awards will be made on a competitive
basis. Applications must be
received no later than May 6, 2005.
For more details about application and
program requirements, visit:
http://www.rurdev.usda.gov/rbs/coops/
vadg.htm, or call (202) 690-2426.
DFA acquires Keller’s Creamery
The producer-owners of Dairy
Farmers of America Inc. (DFA) have
acquired all of the ownership interests
in Keller’s Creamery LP, the nation’s
second largest manufacturer of butter
for retail, food service and industrial
uses. Terms of the deal were not
announced. Keller’s was formed in
May of 2000 as a joint venture
between DFA and Frank Otis and
Glenn Millar, the former management
team of Sodiaal North America
Corporation (although dairy products
have been produced under the Keller’s
brand for more than a century). With
this transaction, DFA becomes the
majority owner of the partnership in
the butter business and will oversee the
management of Keller’s warehouse and
office operations in Harleysville, Pa.,
and the butter processing plant in
Winnsboro, Texas.
“For the past four years, our dairy
farm families have helped to supply
milk and cream that goes into Keller’s
butter churns,” says Gary Hanman,
DFA’s president and CEO. “This
transaction doesn’t really change the
operations, except it creates an even
stronger relationship between our
farmers and the butter brands. It also
provides opportunities for future efficiencies
and market synergies among
our processing units.”
In 2003, the Winnsboro, Texas,
plant churned cream into more than
100 million pounds of dairy products,
including premium and bulk butter,
butter oil, non-fat dry milk powder
and other dairy ingredients. Mark
Korsmeyer, president of DFA’s
American Dairy Brands (ADB) division,
will assume managerial responsibilities
for Keller’s marketing, sales and
manufacturing functions. ADB is the
retail brand division of DFA’s manufacturing
group, which markets processed
and natural cheese, as well as formulated,
dairy-based beverages under DFA’s
regional and national product brands
including: Borden cheese, Cache
Valley cheese, Sport Shake, Sport
Shake Max and VitalCal.
Health care co-ops get
boost in Wis., Minn.
President George Bush in
December made official the $2.25 million
earmarked for Co-op Care, the
project developed by Wisconsin
Federation of Cooperatives (WFC)
and Minnesota Association of Cooperatives
(MAC) to increase access to
affordable health benefit plans. The
funds will be used for establishment
and administration of a “stop loss
fund” that will help diminish the highrisk
label that insurers have attached
to many farmers and small business
owners.
“We are very pleased Co-op Care
was among the projects funded,” said
Bill Oemichen, WFC President and
CEO. “The funds will help pay for
some of the higher-cost claims
incurred by cooperative members,
which will in turn help stabilize premium
rates over a number of years, a priority
of the Co-op Care project.”
In related news, WFC and MAC
members gave their overwhelming
approval to unification of the two
organizations. The action was taken at
the joint annual meeting of the organizations
held in November.
LO’L sales top $7.7 billion;
CEO Jack Gherty to retire
Land O’ Lakes reported $7.7 billion
in sales for 2004, up sharply from $6.3
billion in 2003. But net earnings of
$21 million were down from $82 million
in 2003. The co-op returned $35
million in cash to members in 2004, up
from $24 million in 2003, boosting the
co-op’s five-year cash payout to members
to $198 million.
Land O’Lakes is poised to transform
itself into a farmer-owned organization
that is more focused, financially
stronger and positioned to deliver
on the strategic and financial potential
of its recent growth initiatives,
President and CEO Jack Gherty told
2,000 delegates and visitors at LOL’s
84th annual meeting in Minneapolis.
He said LOL will focus on three key
strategies in driving this transformation:
building on a foundation of excellent
people; accomplishing key portfolio
initiatives and delivering industrycompetitive
results in core businesses.
“Organizations don’t transform people,”
Gherty said. “People — the right
people — transform organizations.”
Gherty, who has led the co-op since
1989 and been on the staff for more
than 34 years, has announced that he
will retire at the end of this year. The
board is now in the process of selecting
his successor.
Chief Financial Officer Dan
Knutson said the decline in net earnings
was due to a $36.5 million charge
related to the company’s $249.5 million
investment in CF Industries (its
joint venture fertilizer manufacturing
unit) and a $23.1 million non-cash
adjustment related to hedging losses.
Proceeds from litigation settlements
were also $17.4 million less in 2004
than in 2003.
“If you factor out these three items,
and their tax impact, you would see net
earnings of $66.5 million from our
base business in 2004, a $13 million
increase from comparable base business
performance in 2003,” said
Knutson.
Land O’Lakes also continued to
make progress in paying down debt
and strengthening the balance sheet in
2004, Knutson said. Since the company’s
acquisition of Purina Mills in
2001, total balance sheet debt is down
more than $200 million. In total, the
co-op has achieved $416 million in
debt reduction over that period. He
also indicated that the expected proceeds
from the recently announced sale
of the company’s swine business would
enable further debt reduction.
The co-op saw improved earnings
in the Dairy Foods, Seed, and
Agronomy businesses, as well as strong
performance in Layers/Eggs. Although
CF Industries’ 2004 performance was
strong, domestic nitrogen manufacturers
remain at a considerable competitive
disadvantage in today’s global market,
Gherty noted. “The doubling of
natural gas costs over the past few
years has created considerable stress on
U.S. nitrogen manufacturers,” he said.
“We are engaged with the other CF
owners to aggressively evaluate the
strategic options to improve performance
and returns.”
Preserving rural heritage, culture
goal of White House/USDA effort
Agriculture Secretary Mike Johanns
marked the second anniversary of the
Preserve America initiative by announcing
that Preserve America communities
will be given priority consideration for
community facility funding projects
that support efforts to preserve and
encourage enjoyment of America’s
priceless cultural and natural heritage.
“There are significant economic,
educational and cultural benefits that
historic preservation provides, especially
to rural communities,” said
Johanns. “Sustainable preservation is
not a cost for maintaining the past, it is
an investment in the future. Rural
communities that are dedicated to historic
preservation will be rewarded for
their vision for the future, as their
efforts help revitalize their local economy
and sense of community pride.”
The Preserve America initiative,
announced by First Lady Laura Bush
in March 2003, is a White House
effort to encourage and support community
efforts to preserve America’s
priceless cultural and natural heritage.
The goals of the initiative include: a
greater shared knowledge about the
nation’s past; strengthened regional
identities and local pride; increased
local participation in preserving the
country’s cultural and natural heritage
assets and support for the economic
vitality of communities. To date, more
than 220 communities in 37 states have
received the designation as Preserve
America communities and will be considered
for priority funding under the
Rural Development Community
Facilities program.
“We want to provide incentives to
communities to look for projects that
will help rejuvenate their local
economies, as well as preserve and promote
our national heritage,” said Gil
Gonzalez, USDA Acting Under
Secretary for Rural Development. The
Community Facilities Loan and Grant
program provides communities with
financial tools and facilitates essential
community facilities such as health
care clinics, police and fire stations,
schools and child care centers. The
program’s flexibility also allows funding
for projects that revitalize rural
economies, such as interpretative centers,
museums or restored historical
buildings. Further information on eligibility
for priority funding can be
obtained by contacting any local
USDA Rural Development office or by
visiting www.rurdev.usda.gov.
Communities designated through
Preserve America receive national
recognition for their efforts. Benefits
include use of the Preserve America
logo, listing in a government Webbased
directory to showcase preservation
and heritage tourism efforts, and
eligibility for special existing and proposed
Preserve America grants and
funding through various government
agencies. The next quarterly deadline
for Preserve America Community applications
is June 1, 2005. For more
information, application forms, and
procedures, visit:
www.PreserveAmerica.gov.
CoBank pays record patronage;
smaller board approved in vote
CoBank’s 2004 earnings of $275
million climbed 5 percent from $261
million in 2003. The increase was driven
largely by a lower provision for
credit losses — reflecting improved
credit quality — and by lower financial
assistance expenses for the Farm
Credit System. The strong showing
will allow the co-op bank to return
$160 million in patronage and stock
retirements to customer-owners for
2004. The cash distributions represent
a record 13.3-percent return on average
invested capital for customer-owners.
For the past five years, CoBank
customer-owners have received an
average of $121 million per year in
cash as a result of their investment in
the bank.
Total loans and leases outstanding
to U.S. and international customers
declined slightly, to $24 billion, down
from $24.8 billion in 2003. Most of the
reduction can be attributed to changing
market conditions and refocusing
portfolio strategy with core rural customers.
“For customers, patronage remains
one of the most tangible measures of
our success,” Douglas D. Sims,
CoBank CEO said. “In 2004, we continued
to build on our history of consistent
financial performance. Even
though loans and leases declined
slightly for 2004, capital grew, our
risk profile improved and earnings
increased.”
CoBank — part of the $125 billion
U.S. Farm Credit System — has
enhanced its capital plan for 2004 by
increasing the overall rate at which
patronage is calculated and by increasing
the level of cash patronage paid to
stockholders. With $30.9 billion in
assets, CoBank specializes in financing
for agribusinesses and Farm Credit
associations, as well as rural communications,
energy and water systems.
In other developments, 96 percent
of the bank’s stockholders recently cast
votes approving bylaw changes which
will reduce the size of the current 26-
member board to 15 to 17 members.
Existing representational districts will
be combined into three regions (East,
Central and West), each of which will
elect four directors. The board will
also include a maximum of three outside
directors (who can have no customer
affiliation with the bank) and
two appointed directors (who may
have a customer affiliation). Director
terms are being expanded from three
to four years.
Isom, Toelle NCFC’s
directors of the year
The National Council of Farmer
Cooperatives (NCFC) has awarded
Howard Isom, a farmer from Chico,
Calif., and board chairman of Blue
Diamond Growers, the Farmer
Cooperative Director of the Year award
for directors with 12 or more years
tenure. Mike Toelle, a farmer from
Browns Valley, Minn., and chairman of
CHS Inc., won the award for the director
with less than 12 years tenure on
the board. Isom and Toelle were saluted
for leading their cooperatives to
meet the needs of farmer-members
while positioning their co-op’s to compete
in a rapidly changing global marketplace.
Isom, a Blue Diamond member
since 1969 and a director for 16 years,
farms 1,200 acres of almonds, walnuts
and grapes. He is also president of
Matson and Isom, an accounting firm
in Chico. Toelle, a co-op member his
entire adult life, works a 3,200-acre
grain, hog and cattle operation with
his family near Browns Valley. “Both
Harold and Mike are dedicated to the
principles of farmer-ownership and
their leadership of their respective
boards makes them worthy recipients
of the Director of the Year award,”
says Jean-Mari Peltier, president and
CEO of NCFC. The awards were presented
Jan. 23 at NCFC’s 76th annual
meeting in Carlsbad, Calif. The award
was established to recognize the outstanding
achievements of farmer cooperative
directors who take the lead to
help their boards make decisions vital
to their cooperative.
FCS America board election
reflects anti-sale sentiment
Results of a board election in
January for Omaha-based Farm Credit
Services of America give further evidence
of members dissatisfaction with
a plan that would have sold the co-op
lender to Rabobank had it not been
scuttled by member opposition and the
concern of Congress. Five directors
elected to the co-op’s 17-member
board were all endorsed by Farmers
for Farm Credit, the grassroots group
that led opposition to the sale.
Myron Edelman of Watertown,
S.D., chairman of Farmers for Farm
Credit, which opposed the sale, said
the election indicates that the cooperative’s
members want to stay within the
national Farm Credit System, according
to a report in the Omaha World
Herald. “A strong majority of the
stockholders seem to agree with our
position,” Edelman said.
“Sometimes we forget, particularly
in large business entities, that they still
work for the owners,” Neil Harl, an
Iowa State University professor, told
the World Herald. “Sometimes the
shareholders are goaded into taking
matters into their hands. I think this is
one of those examples.”
Incumbent board members Alan J.
Steffens and James K. Geyer were
defeated by Darrell Cain of Elwood,
Iowa, and Larry Paulsen of Coleridge,
Neb. Cain and Paulsen were nominated from the floor at the co-op’s annual
meeting. Incumbents Dean Chapman
of Russell, Iowa, Gene Hammen of
Wellman, Iowa, and Lyndon Limberg
of Gary, S.D., were re-elected.
“Payback” new CHS feed brand
Payback is the new ‘umbrella’ brand
for all animal feed formulations from
CHS, available through some 500 local
co-ops and independent dealers in nine
northern states. “With the CHS corporate
name change in 2003, it was
time to establish a product brand identity
for animal feeds that was separate
from the company name,” says John
Steffen, vice president for nutrition.
“Our biggest challenge is reassuring
dealers and producers that the formulas
have not changed.”
Payback products include a complete
feed line for livestock, horse,
swine and poultry, as well as specialty
blends that were manufactured for
decades by Harvest States Feeds, one
of CHS’ predecessor co-ops.
The process of establishing a new
brand name included developing a
Web-based survey sent to beef producers
in six states across CHS’ core trade
territory. Overall, the single most
important attribute respondents said
they wanted from their feed company
was the commitment to help them be
more profitable. The proposed
Payback name ranked highest as
appealing, memorable and relevant.
In other news, the CHS Foundation
has announced that it will contribute
$172,840 to CARE for Asian tsunami
relief efforts. In early January, the
CHS Foundation pledged an initial
$100,000 contribution and implemented
a match program for CHS Inc.
member cooperative locations and
employees of CHS and Agriliance
LLC, a CHS joint venture company.
Michigan cattle producers unite
to pursue market opportunities
Frustrated with the obstacles facing
the beef industry and the challenges
posed by bovine tuberculosis, a group
of northeastern Michigan cattle producers
have banded together to form
North Country Beef Producers
Cooperative. The group was formed to
explore new marketing opportunities,
increase profitability and provide educational
opportunities for members.
In addition to working to strengthen
their business skills, the 40 members
also are educating themselves
about vaccination, animal health and
nutrition, genetics and management
practices for cow/calf producers as well
as backgrounders and feeders. As part
of this effort, they approached
Michigan State University (MSU)
Extension, the MSU Product Center
for Agriculture and Natural Resources,
and the Michigan Department of
Agriculture (MDA) to explore new
marketing opportunities to increase
profitability.
“The biggest challenge is finding
new ways to market beef,” says Dave
Glenn, Presque Isle County MSU
Extension director. “We are looking
into value-added options to increase
the profitability of beef producers in
northeast Michigan. “Glenn is an
innovation counselor with the MSU
Product Center. He is working with a
core group of seven of the cooperative’s
members to create a business
plan and determine the best way to
market beef using options that are feasible
for the group. One option being
considered is retained ownership —
finishing the cattle rather than selling
young stock — which will result in
increased profitability.
“By feeding out our cattle, we don’t
have to worry about as many obstacles
relating to TB — this removes one
obstacle facing farmers in our area,”
says Marty Galbraith, a member of
the North Country Beef Producers
Cooperative. “One of the problems
many of the producers face is that as
individuals, they don’t have sufficient
cattle to attract buyers,” says veterinarian
John Molesworth, the co-op’s
executive director. “Forming a cooperative
is one way of putting together
larger groups of like kind cattle to
attract buyers.” For more information
about the co-op, contact Marty
Galbraith at (989) 826-3793.
Georgia Co-op Center gets
boost from USDA grant
A $266,000 grant from USDA
Rural Development to the Georgia
Center for Agribusiness and
Economic Development will give
Georgia its first statewide farm coop
development center. The new
Georgia Cooperative Development
Center (GCDC) will be one of 20
such centers in the United States.
The GCDC will support fledgling
co-ops and help farmers who want
to form others, says CAED coordinator
John McKissick. Before the
grant, he said, there weren’t enough
resources to meet all of the needs.
The CAED is part of the University
of Georgia College of Agricultural
and Environmental Sciences.
“The grant will focus on cooperative
development and providing more
services to those in agriculture who
think they have a future to develop as a
co-op,” McKissick said. It will fund
two business development specialists
and other resources. The CAED has
played a key role in successful co-ops
such as Sunbelt Goat Producers in
Washington County and Farm Fresh
Tattnall, a co-op of roadside markets
and pick-your-own farms in Tattnall
County.
The new center’s steering committee
has already approved new feasibility
studies, board training, market analyses,
business plans or other support
for four co-ops: an ethanol production
co-op of Georgia corn growers; the
Sunbelt Organic Gold co-op of south
Georgia poultry growers who want to
make and market organic fertilizer
from chicken litter; a community food
network that would match organic
produce growers with markets in suburban
Atlanta, and a co-op that would
match organic markets with grass-finished
beef.
GROWMARK forms alliance
to offer grain-risk services
GROWMARK has formed an
alliance with Decision Commodities to
deliver and develop grain-risk management
products and services. GROWMARK
is a regional, federated cooperative
system made up of local grain and
farm supply cooperatives across the
Midwest. Decision Commodities provides
innovative forward contracts to
grain producers. The company’s market-
based pricing tool, Decision
Contracts, provides farmers a means of
protecting themselves from adverse
price movements.
According to Davis Anderson,
GROWMARK vice president/grain,
GROWMARK member cooperatives
were looking to find innovative
grain/risk management products and
services to help improve the profitability
of their farmer-customers. “Decision
Commodities has demonstrated
the success of its business model working
with local cooperative elevators.
The partnership will accelerate the use
of the company’s contracts and provide
a foundation for competitive success
among our member cooperatives in the
area of producer risk management services,”
Anderson says.
As part of the partnership, new services
and products will be developed
through shared work and resources of
GROWMARK and Decision Commodities.
GROWMARK will be making
an investment in Decision Commodities
and will have a seat on the
board of directors.
Soybean association joins
crop insurance co-op
The Minnesota Soybean Growers
Association (MSGA) is joining with 17
farm associations to sponsor Growers
National Cooperative Insurance Agency
Inc. GNC provides an alternative way
for MSGA members to purchase federal
crop insurance. Through GNC, sponsoring
associations will have a voice in
providing insurance tailored to the specific
needs of members. “This win-win
program will lead to increased membership
in MSGA and will provide an
innovative way to purchase federal crop
risk management tools,’’ said Ron
Jacobsen, MSGA president.
Co-ops have $6-billion
impact on North Dakota
Cooperatives provide full-time
employment for more than 11,000
people in North Dakota and contribute
more than $6 billion to the
state’s economy, a North Dakota State
University official says. Researcher and
professor Larry Leistritz said the study
is the most comprehensive yet of
North Dakota co-ops, according to a
report in the Bismark Tribune. It
looked at the economic activity of all
types of co-ops, taking into account
factors such as retail trade, personal
income, total business activity, employment
and tax revenue. North Dakota
has 405 co-op businesses, most of
them relating to agriculture.
Iowa, Illinois get
new winery co-ops
Iowa and Illinois are not usually
thought of as wine-producing states,
but each has a growing number of
small vineyards and new cooperatives
are forming to serve the growers. Two
Rivers Grape and Wine Cooperative is
the first farmer-owned cooperative
making wine and growing grapes in
Iowa, according to the Des Moines
Register. The new winery is one of
about a dozen planning to open soon
in Iowa. It is more evidence, say Iowa
wine boosters, that the state is undergoing
a rebirth of an industry that was
all but wiped out by Prohibition and
other factors.
“The wine industry is growing so
fast, I’m having trouble keeping up,”
White, of the Iowa State University
Extension, told the Register. “It is going
to happen in Iowa.” Iowa now has
about 30 wineries that sold about
76,000 gallons of wine in 2003. More
than half of Iowa-produced wines are
made in the Amana Colonies.
Meanwhile, a new winery co-op has
also been formed in Illinois, with 11
small vineyards as members. Shawnee
Winery Co-op is producing eight
wines for its members, whose vineyards
range in size from half an acre to
eight acres. About $300,000
in state and federal grants
helped to launch the co-op.
It has a 4,000-square-foot
building that includes a
production area and a wine
tasting and retail area.
A 2003 study of
Missouri’s wine industry
shows that the state’s 47
wineries have a significant
effect in stimulating rural
economies.
Preliminary settlement
reached in MCP lawsuit
A preliminary settlement
has been reached in a classaction
lawsuit filed against
five former executives of the
Minnesota Corn Processors
(MCP) for their role in
convincing farmers to sell
their ethanol and sweetener
business to Archer Daniels
Midland for $400 million in 2002.
That amount was only a fraction of the
true value of the business, according to
farmers of the former co-op.
Although growers voted to approve
the sale of MCP, which had converted
into a producer-owned limited liability
company by the time of the sale, many
now feel they were misled by their
own officers, who they allege were
looking out primarily for themselves
(see July/August 2004 issue of Rural
Cooperatives, page 22, for detailed background
on the MCP sale; past issues
are on-line at www.rurdev.usda.gov/
rbs/pub/openmag.htm).
The lawsuit alleges that MCP CEO
Dan Thompson and four other officers
conspired in self-dealing to sell MCP
for personal gain. A sixth individual is
charged in the suit with alleged conspiracy
and breach of financial duties.
Under the settlement, the five executives
would pay $5.75 million to the
farmers.
The MCP executives’ defense was
weakened by a note that Thompson
wrote to ADM officer Marty Andreas,
in which Thompson says: “my
thoughts are that I am the only person
who could get them to accept a lower
number.” When read in context, it is
clear that Thompson meant he would
work to convince farmers to take a
lower price than the true value of
MCP, the plaintiffs say. An editorial in
the Marshall (Minn.) Independent called
that hand-written note a “smoking
gun” of culpability.
“We are pleased this hard fought
litigation has come to an end,” the
class action committee says on its Web
site. “We are particularly pleased that
the facts behind this merger have been
fully debated. A trial and appeal of this
matter presented risks and costs to
both sides. The parties were well
served by a conscientious and hardworking
judiciary which identified the
respective strengths and weaknesses in
the parties’ positions prior to trial.
Based upon this meaningful settlement,
it now seems time for the issues
surrounding the ADM/MCP merger
to come to an end.”
Notice of the settlement was sent
out to about 5,000 shareholders in late
February. A final hearing has been
scheduled for April 12, at which time
the court will approve or deny the settlement,
according to attorney Robert
Moilanen, of Zimmerman-Reed PLLP
in Minneapolis, legal counsel for the
growers. Some farmers elected last
year to opt out of the class action, and
will not share in any disbursement
arising from the settlement. They
could, however, still pursue litigation
on their own. Otherwise, if approved,
members would share in the settlement
based on the number of shares they
owned in MCP (after attorney fees and
expenses are deducted).
