Here is a list of questions and answers regarding the proposed merger between Genesis and Ag Partners.  We look forward to answering any additional questions you might have.  Please direct your questions to Greg Schwanbeck, Bill Ahlbrecht, or Mike Alme and they will be happy to help you.

Q & A for Genesis and Ag Partners

Proposed Merger


Creating the Future Together


Q:        Why should Genesis and Ag Partners unify their businesses?

A:         This is an opportunity to combine two diverse, successful cooperatives in a way that will meet member and customer needs today and well into the future.  The producers our cooperatives serve today continue to grow and change their operations. We need to change and grow along with them.


Q:        How did the proposed merger get started?

A:         We started talking about our need to grow and how we could complement each other in our core business areas.  It became obvious that we could be stronger together than we are alone.  While both cooperatives are performing well today, we recognize that today’s market conditions require us to seek economies of scale and access to resources to grow for the future.


Q:        Why do we have to grow – Will the new company be too big?

A:         No, although the new company will be about $300M in sales, the competition in our trade area continues to be more and more multi-national companies who measures their sales in Billions of Dollars (ADM, Cargill, Agrium CPS, CHS, etc.)  We will be at a better competitive position against these companies, while still maintaining our commitment to our local members.  Also, our surrounding area local cooperatives continue to grow and merge as well.


Q:        What are the benefits?

A:         This merger will allow the two cooperatives to capitalize on our current strengths, gain efficiencies in current operations and diversify our business portfolio with Agronomy, Energy, Grain and Feed Assets.  It increases our ability to hire and retain the best employees to serve our customers.


Q:        What is the financial strength of these two cooperatives?

A:         Information on Genesis: Parent co-op history dates back to 1916.  Genesis formed in 2008 with the merger of Hwy Ag Services and the Belle Plaine Coop.  In FY 2017 Genesis had $66M in sales, local net profit of $1,859,943, working capital of $6.3M and $31.4M in Total Patron Equity.


Information on Ag Partners Coop: Parent co-op history dates back to 1905.  “Ag Partners Coop” formed in 1996 and merged with Farm Country Coop of Pine Island in 2013.   In FY 2017 Ag Partners had $223M in sales, local net profit of $8,141,375, working capital of $18.4 million dollars, and $78.3M in Total Patron Equity.


In addition, Ag Partners has significant sales, profitability, and net worth in various Limited Liability Companies (LLCs).


Q:        Is this actually a merger?

A:         Yes, it is – Genesis member equity will become equity in Ag Partners; agricultural producers will

retain voting rights; Members will have continued Local Board Representation.


Q:        What happens to my equity if the merger is approved?

A:         Every dollar of Genesis Equity will transfer to Equity of Ag Partners Cooperative on a dollar for dollar basis.  Information meetings on the Ag Partners Preferred Stock program will be held on this program after the merger effective date.  From the unification date forward Genesis and Ag Partners members shall accumulate equity in a like manner and without regard to co-op membership prior to the effective date of unification.


Q:        How does the merger work?

A:        The method used to unify the two companies is called a “Reverse Triangular Merger.” In a Reverse Triangular Merger, no cash exchanges hands; rather, the operations of the two companies are combined into a new, larger organization.


Q:        How is the merger approved?

A:        The unification requires a 2/3 affirmative vote from the members of Genesis.  Eligible voters are Genesis Co-op Ag Producers who did $7,500 of business in Fiscal Year 2017.


Q:        Why do only the members of Genesis vote?

A:         The unification method chosen requires a vote from only one cooperative’s membership. This is most efficient and cost-effective way to complete the unification.


Q:        When does your vote need to be cast?

A:         Ballots will be mailed to Genesis voting members on December 1st.  Ballots will be counted on December 19th.  Patron Informational meetings are being held from December 5 -7, 2017.


Q:        How do I cast my vote?

A:         You may cast your vote by mail or drop your vote off in the box provided at each Genesis location.  However, in any case, your ballot must be received in the Le Sueur Corporate office by 12:00 noon on December 19, 2017 to be counted.


Q:        What is the effective date for the merger?  

A:         The proposed unification would be effective April 1, 2018.


Q:        Where will the new cooperative’s main office be located?

A:         Goodhue will remain the headquarters for the new consolidated Ag Partners.   All current business office locations will remain open for patrons to transact business with the unified cooperative.


Q:        What is the management structure? 

A:         Greg Schwanbeck continues to manage Ag Partners. Joe Spinler will assume a management role in the new consolidated company.


Q:        How will the proposed cooperative’s Board of Directors be structured? 

A:         The proposed unified cooperative will begin with 12 directors; 4 from Genesis and 8 from Ag Partners.  Balance Sheet Financial Ratios were used to determine fair initial Board Representation by Cooperative.  It will be the Board’s responsibility to have equitable representation throughout the combined trade territory.


Q:        Does the merger eliminate competition?

A:         Not at all. Look around at the marketplace and you’ll find cooperatives, equipment dealers, banks, and retail stores have all developed economies of scale to add value to shareholders. As we look around the trade area we see significant competition, making it necessary for us to combine resources to be able to remain your best option.


Q:        What about customer service?

A:         Excellent service from committed people is a part of the heritage and commitment of both cooperatives. Genesis and Ag Partners have many long-term, committed staff people who are engaged with customer success. Our goal is for service – to be as good or better than it has been in the past.  We will strive to enhance the profitability of each our patron’s farming operations or commercial businesses.


Q:        Will facilities be closed?

A:         The feasibility study prepared did not project any closing of facilities.  We expect evaluation of specific businesses and facilities to be an ongoing process as the new organization is established. We have a common goal of continuing to provide our customers with excellent products and services from people they trust.


Q:        Will our employee base change? 

A:         The feasibility study projected all employees to be retained by the consolidated cooperative.  Our commitment is to maintain open communication with our employees and work to alleviate the impact of any changes that could occur.


Q:        Is this merger supported by the full Boards of both companies?

A:         Yes!  Both Boards of Directors are unanimous in their support of this merger.  The Genesis Board is asking you for your support of this proposed merger and urges you to vote YES on this proposal.