“This is an excellent opportunity to expand our relationship with Southern States and increase our animal feed business in the eastern U.S.,” said Chris Policinski, president and chief executive officer (CEO), Land O’Lakes, Inc.
The proposed acquisition reinforces a commitment by both parties to help their customers continue to compete with industry-leading products and services in an era of industry consolidation, the companies said.
“We are looking forward to engaging with the Southern States members and customers to understand their needs,” said Beth Ford, group executive vice-president and chief operating officer, Land O’Lakes, Inc. “We plan to provide uninterrupted access to the Southern States branded products customers trust for their animals, and we will work every day to deliver the quality, innovation and expertise they expect of us.”
Southern States, established in 1923, has more than 200,000 farmer-members. The cooperative provides a range of farm inputs, including fertilizer, seed, livestock feed, pet food, animal health supplies and petroleum products, as well as other items for the farm and home. It serves its members and non-member customers through 1,200 retail outlets in 23 states.
“We are pleased with the opportunities this partnership with a fellow cooperative brings to Southern States,” said Jeff Stroburg, president and CEO of Southern States Cooperative. “Our members will continue to receive the same level of service from our retail locations while benefiting from Land O’Lakes’ feed business, Purina Animal Nutrition and their knowledge and experience in manufacturing the quality feed our customers expect.”
The purchase is expected to be completed in January 2017.
This is the second transaction in the past few months that Southern States has sold a segment of its business. Southern States and Perdue AgriBusiness announced on Sept. 23 the closing of a transaction that will ensure the continued operation of over a dozen Mid-Atlantic grain elevators. Perdue AgriBusiness will purchase 10 of the 12 elevators that the company has leased from Southern States, Richmond, Virginia, U.S.-based farm supply and service cooperative, since 2002 and will continue to lease two other elevators that are immediately adjacent to Southern States feed mills.
The proposed Southern States feed business purchase is one of Land O’Lakes most recent endeavors. On Aug. 11, Land O’Lakes, Inc. and Bidco Africa announced a partnership that will capitalize on the growth potential of agricultural markets in Kenya. The two organizations are leveraging their distinctive and complementary animal feed portfolios to create Bidco Land O’Lakes Ltd.
Land O’Lakes completed the acquisition of Ceres, Inc. on Aug. 2. Ceres is an agricultural biotechnology company that develops and markets seeds and traits to produce crops for animal feed, sugar and other markets.