The grain firm formerly known as the Canadian Wheat Board wants it known the company’s looking for an industry partner, not a new owner — and not just any partner.
Aiming to scotch what it calls “speculation and inaccuracies” in recent reports about its future and its plans for full commercialization, CWB laid out its concerns in an open letter published Friday, in which it emphasizes the operation “is not being sold or given away.”
The letter, signed by CWB’s chief strategy officer Dayna Spiring, follows the announcement in late October from Saskatoon-based ag input buying group Farmers of North America (FNA) that its proposal to buy CWB has been rejected.
Spiring’s letter Friday expands on comments last month to Manitoba Co-operator reporter Allan Dawson on the subject of CWB’s privatization plans.
When the Wheat Board’s single marketing desk for Prairie wheat and barley was deregulated in 2012, amendments to the Canadian Wheat Board Act called for CWB to provide a commercialization plan to the federal government by 2016 and to execute on that plan by 2017.
CWB, Spiring repeated Friday, has “always said it intended to beat those legislated deadlines” and since 2012 “has been building a network of assets and is on the path towards commercialization.”
Among those assets, Winnipeg-based CWB is building new grain elevators in Saskatchewan and Manitoba, has bought two independent grain terminal operations in western Saskatchewan and now owns grain handler Mission Terminal, including that company’s Thunder Bay port terminal. CWB is also now awaiting delivery of the first of two new laker vessels the Wheat Board bought in 2011.
CWB’s growth strategy, Spiring wrote, will take “significant capital,” for which CWB and its advisors are running “a rigorous process of looking for a strategic partner that meets a number of criteria.”
Said criteria, she wrote, include “experience in grain handling, industry expertise and enough capital to continue to expand CWB’s strategic network of grain-handling assets.”
That such an investor supports “the idea of western Canadian farmers being provided an opportunity for ownership in CWB going forward” is also “critically important,” Spiring added.
Right now, she wrote, it’d be “inappropriate and in fact detrimental to the (commercial) process to confirm or deny which companies are interested in partnering with us until we have concluded our due diligence.”
Media reports in October had cited rumours of major industry players such as ADM and Louis Dreyfus being close to putting up offers for CWB.
That said, she added, “any bids rejected to date were evaluated by CWB and our advisors using the rigorous criteria listed above. If bids were rejected it was because they did not meet the requirements.”
The goal, Spiring said, is “to develop a strong and viable grain-handling company in Canada that can compete with the best in the business and to give farmers an opportunity to have an ownership stake.” – AGCanada.com Network
AGCanada / Commodity News Service Canada