Producer’s patrons approve takeover

Posted January 31, 2013 at 9:10 am

MFA to keep Producer’s offices open

By a vote of 195 yes to 19 no, the Producer’s Grain Company patrons (those who did $1,000 or more business during the past year) voted to approve the MFA Inc. proposal to take over the financial insolvent agricultural cooperative.

The vote took place at the conclusion of the 91st annual Producer’s Grain annual meeting as an affiliate of MFA. Producers was founded in 1920 as a stock owned company and in 1963 was converted to a member owned cooperative.

Board President Jerry Brackenridge said that 143 yes votes were necessary to meet the 2/3 majority requirement to approve the two contracts the board and MFA signed earlier to let MFA take over the land and the other assets. The closing on the deal will be on Feb. 15, 2013.

MFA has agreed to take over the $7.6 million in liabilities of Producer’s Grain and its $6.7 million in assets.

In discussions before the vote, MFA officials told the patrons that MFA will keep the four facilities of Producer’s Grain open with no down time – El Dorado Springs, Walker Nevada and Bronaugh. MFA will let the 42 current Producer’s employees apply for positions with the new cooperative which will be named Producers MFA Agri Services.

MFA officials said that their plan is to invest up to $400,000 per year to upgrade the facilities of Producer’s Grain.

As the votes were being counted by volunteers Dennis Daugherty – president of Community Bank, Kevin McCullough – owner of Evans Drug and Carole Wilkerson – Cedar County Recorder – the patrons voted to retain Jerry Brackenridge and Wade Rapp on the board. The current Producer’s Grain board will become an advisory board to MFA Inc. as it has in its 135 locations in Missouri, Southeast Kansas, North Central Arkansas and part of Iowa.

After the results of the vote were announced, Bill Streeter, CEO of MFA Inc., told the group that he appreciated their vote of confidence. He then announced some of ways that MFA Inc. is active in the communities it serves. He said the company gives one $2,000 scholarship to a high school student in the community. The company gives $25 to $50 per ton prices breaks to FFA and 4-H students feeding calves for competition. MFA will attend the Youth Fair and buy animals.

Brackenridge said after the meeting that he appreciated the huge turnout of patrons. He said that some years the board had to go find people to have the required 15 patrons for a quorum in order to conduct the annual meeting.

He said that Producer’s made money or broke even in five of the last 19 years. In the 1980’s, he said, the company lost $1.2 million when struggling farmers took bankruptcy. At that time total sales were $8 million per year.

Before the vote, two patrons spoke about how the community and the farmers in it need a place to sell their grain and buy products. They urged patrons to think about the alternative of losing another business if they voted no on the take-over.

Both speakers drew applause giving an early indication of the mindset of the assembly. One member of the audience asked about the financial condition of MFA Inc. The chief financial officer went to the microphone and told the group about the hundred million MFA has in reserves and the nearly $200,000 in earning each year. (Editor’s note: These are generalizations of what the CFO said. At three hours past deadline on a Tuesday night, I don’t have time right now to go back and listen to my tape of the meeting, but I will later and report back to you. Bottom line – the numbers were impressive and reassured the Producer’s patrons.)

After the vote, Brackenridge urged those present to patronize MFA to keep it strong in this community.