Quebec's ag co-ops buy up Agrico Canada
Sep. 7, 2011
La Coop federee on Tuesday announced it has sealed its deal to buy Mississauga-based Agrico for an undisclosed sum, including its head office, four storage terminals and joint-venture ownership stakes in a network of 12 ag input retail companies in three provinces.
The deal is expected to allow La Coop federee to "consolidate the Ontario market and to reduce costs in Quebec, since it will now have a stronger hold on the market and be able to benefit from a judicious use of its commercial and harbour facilities along the (St. Lawrence) seaway," Coop CEO Claude Lafleur said in a release.
Also, he said, the deal will allow the ag inputs sector to "improve its competitive positioning in terms of input distribution in the field of crop production."
Agrico, which started in 1931 under the name Agricultural Chemicals Ltd., started out in the retail business but began spinning off its retail holdings into joint ventures in recent years in a "conscious change in corporate philosophy."
Apart from its wholly-owned retail centre at Chambly, Que., the company's joint-venture retail operations include Double Diamond Farm Supply and Rosenort Agro in Manitoba; Clearview Agro, Garex Ag and KARE Ag Services in Saskatchewan; Sharpe's Soil Services in Saskatchewan and Manitoba; and Agri-Partners, Atwood Farm Supply, Cavan Agri Services, Holmes Agro, Kawartha Lakes Agri Services and Northumberland Grain in Ontario.
Agrico also owns regional-scale fertilizer distribution terminals at Hamilton and St. Thomas, Ont., as well as near Winnipeg at Oak Bluff, Man., and at Chambly, Que. It also leases storage at Oshawa and Port Stanley, Ont., Biggar, Sask. and St. Paul, Minn.
Agrico recently expanded its storage space at St. Thomas and pledged a $2.5 million expansion at Hamilton, in part to take up product when its lease ends at its UAN storage site at Port Stanley. The Port Stanley site's landlord, Toronto-based McAsphalt, plans to begin using the space itself.
"Remain the same"
Agrico in 2008 had appeared poised to be taken over by Norwegian fertilizer giant Yara International, but Yara shed its 25 per cent stake in Agrico in 2010 without exercising its option to buy full ownership.
As far as employees of Agrico are concerned, La Coop said Tuesday, the acquisition "will not bring about any major changes, since the company's mission and orientation will remain the same."
La Coop federee's expansions outside Quebec in recent years have included Ontario grain marketing firm Grower Direct Exports, as well as ag retail firm Agronomy Co. of Canada, which owns stakes in Agromart retail outlets in four provinces.
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