In 1945, after World War II, I joined my family’s seed business, the L. Teweles Seed Co. in Milwaukee. My great grandfather, Ludwig Teweles, had founded the company in 1865 and I was the fourth generation. At that time, Teweles was considered the second largest forage seed company in North America, right after Northrup King & Co.

Since those early days, not a year has passed when I haven’t heard industry executives say, "The seed industry is changing." One of the early changes led by our firm was the branding of seed in the 1920’s. Previously, forage seeds were sold as a grade - prime, choice and fancy. My grandfather, Hugo Teweles, was a zoo buff and he branded our top quality Badger brand, with two lesser qualities to be known as Buffalo brand and Elk brand. Shortly after I joined the company, forage seed began to be sold in smaller bags, 60 pounds for alfalfa, clovers, etc. and 45 pounds for timothy, with orchard and brome grass in 50-pound bags. Previously, the legumes had been in 150-pound grain bags, timothy in 125 pounders, with orchard and brome grass in 100’s. Believe me, these packaging changes pretty nearly blew the whole company apart.

Another significant change was the advent of publicly developed certified seed, being produced on contract in the western states. Alfalfa was the big tonnage at the time and the killer crop. The first publicly developed was Certified Ranger alfalfa, grown of all places in the hot San Joaquin Valley of California. Because of isolation, the seed crop maintained its northern hardiness. One of the huge commercial problems with the Certified alfalfa was that it wiped out the quality and brand difference between the major companies and the locals. This had the unpleasant result of creating a price war, which was very damaging to the majors.

After a few years of blood letting, our competitor in Minneapolis, Northup King & Co., came forward with a brilliant idea. They blended various state origins of similar hardiness alfalfa together and gave the product a brand name 919. Wisely, NK established dealer and retailer prices on 919 to allow the local retail merchant a 50% greater profit margin on 919 than on Certified Ranger alfalfa. NK heavily promoted 919 in the agricultural media. 919 was a huge success. If you’re not the leader, you better follow quickly and the next year at Teweles we marketed Multi-Strain brand alfalfa, which was a combination of Ranger, Grimm, Cossack, and Ladak varieties, all produced in Montana. These new branded products gave the majors a real shot in the arm in terms of increased revenue and profitability. But this was just the beginning.

The next step for the leading forage companies was to hire PhD plant breeders to develop our own proprietary varieties of alfalfa, clovers, field grasses, etc. This was the beginning of the brain drain of plant breeders from the USDA and land grant colleges into the private forage seed sector. That change is pretty much evident today with very little forage seed research being done in the public sector. Historically, a similar pattern had previously taken place in the 30’s in the hybrid seed corn industry where the early hybrids were developed by the plant breeding staff of the land grant colleges. Then, the profit margin squeeze of small and large companies having access to the same pedigrees forced the majors, DeKalb, Pioneer, etc., to establish research departments and breed their own hybrids. In many cases they utilized inbreds developed by the public experiment stations.

Things rocked along pretty well at the old family company. Then, in the early sixties an apparently innocuous event took place. The Woodruff Seed Company of Milford, Connecticut was acquired by the Upjohn Company, Kalamazoo, Michigan, a major pharmaceutical firm. This event was as far as I can remember the first important seed company acquisition although at the time we didn’t have any idea of why the acquisition was made and where it might lead. Woodruffs were vegetable seed breeders and marketers as well as turf seed specialists. Why in the world would a multibillion-dollar drug company want to own a piddling, little $20 or $25 million annual sales seed company? None of us had any idea of the ultimate impact of this early transaction. But, again, this was the changing seed industry.
Leapfrogging ahead to 1972, we sold our family seed company to Kent Feed Company in Muscatine, Iowa. After three and half generations, the ownership of Teweles seed shares was widely split among those of us in the family who were operating the business and the other family shareholders who needed dividends from the business to maintain their lifestyle. It became clear that our company could no longer continue investing significantly in research and pay the kind of dividends the shareholders felt they deserved. By that time our company had moved aggressively into hybrid seed corn and proprietary soybeans and our research budget had become significant. Selling the company resolved these problems to the satisfaction of all the shareholders.

Brother Bob Teweles moved to Muscatine, Iowa to become General Manager of the seed company for the new owners. Like so many other things in life, chance brought an opportunity that was to change my world. I was 49 years old, unemployed, with four children and had just purchased a new house. I needed work. Opportunity came in the form of a phone call from the Arthur D. Little Company, Boston, Massachusetts, a major consulting company, who had just finished marketing a multiclient study entitled "The US Seed Industry". ADL had orders for 35 of these multiclient studies from multinational agricultural chemical and/or pharmaceutical companies around the globe. ADL had a problem - who was to execute the study, which they sold for $30,000 each, fifty percent payment in advance? That’s where I lucked out. I was hired on a per diem basis to help ADL write the study, working with their top executives. As I said, I needed work. While the wages were not exactly executive category, the assignment was really very simple because at that time I had already been in the industry for 28 years and understood how it worked. Not to mention having dozens and dozens of friends, former competitors, in high places in the seed industry. So I said, "Yes, let’s roll."

A question arose in my mind at that time. Why were 35 famous multinational companies interested in investing in a multiclient seed study? As I got behind the scenes, it developed that the McKinsey & Company, a leading international consulting firm, had sold the idea of the seed industry as significant investment and growth opportunity to the chief executives of these companies. Some of the names have come and gone since then, but I will mention a few just for old time sake: Sandoz, Ciba Geigy, Dow, Union Carbide, Pfizer, Unilever, Hoechst, Merck, etc. Little did I know these and many more were ultimately to become my clients.

The seed study took about nine months. Again and again, my seed trade friends asked me, "Why was I working for Arthur D. Little Company and couldn’t I go into business writing and selling these studies myself?" One day flying back from Boston, lightening struck and I decided to setup L. William Teweles & Co. in the library of my home and installed a separate telephone line and had some business stationery and calling cards printed; I was off and running.

My first project was the "Global Seed Study" which encompassed not only North America, but Europe, Latin America and Japan. ADL had setup a pretty good pricing schedule, which I followed plus 15 percent. I think all of the subscribers to the ADL study acquired my study and maybe a few more.

A few months after publishing the "Global Seed Study" one night I received a telephone call at home on my business line. It was from the head of the agricultural division of Pfizer who had subscribed to my study and wondered whether I could help them make some acquisitions in the seed industry. I told them I would think about it and get back to them the next day. Five months later, I had helped Pfizer acquire Clemons Seed Farms, a major Iowa producer and marketer of soybean seed. Clemons had been a producer of soybeans for the Teweles Company and I knew them very well. The check I received for the Pfizer transaction was the largest I had ever seen. A whole new world was opening for me. Shortly thereafter, I sold Pfizer two more seed companies. My consulting business now could be labeled a consulting and investment banking business. Very exciting times.

Soon thereafter, a number of other multinationals gave me acquisition assignments. The first wave of seed company acquisitions was underway. I soon learned that the McKinsey strategies for the multinationals was that seed was the basic foundation in the food chain and that by controlling the source of seed the multinationals could control the entire food chain from seed through processing and the distribution phases. This proved to be a great story and the multinationals bought in. I also learned that in the multinational world "monkeys see, monkey do". The majors followed each other, not willing to let a competitor get ahead. These seed scenario instructions to management came via their board of directors as marching orders. So much for the first stage of seed company acquisitions in the 1970’s.

Interestingly enough, just as the momentum of food chain scenario for the multinationals was beginning to slow, another unforeseen event took place that rekindled the acquisition fever. This was the discovery of double helix by Watson and Crick, which unleashed the profound new science of plant biotechnology. Almost overnight, the price of seed companies ramped up, and then some, as the competition to acquire became fevered. Row crop companies, i.e. hybrid seed corn and soybean seed, were the favored targets. But, vegetables, sorghum, even grasses, showed up on the acquisition list. Running through every thoughtful seedsmens’ mind was the question of the future; were the local, regional and national seed firms going to become extinct? Were the multinationals going to run the whole seed world; were the giants going to up prices and their profit margins and would this hurt the farming community? There were more questions than answers. Fear was in the air. Those multinationals that had acquired early in the "food chain" scenario now looked very wise indeed as the value of their seed company investments escalated.

But, as I said earlier, the seed industry is always changing. Come the late 80's, many of the multinational seed acquirers had grown disenchanted with seed. Those of us who had been in the trade for years knew this is not a high profit margin business. Further, the majors discovered that their highly paid MBA management, who were successful in running chemical and pharmaceutical businesses, were facing new problems in the seed trade and in many cases made poor decisions.

Thus, the next period of change. A number of the multinationals left the seed trade, selling their trophy companies to other multinationals who still saw a pot of gold at the end of the seed rainbow. Other family seed business that had resisted the early call to sell, now decided to cash in and take their chips off the table. The merger & acquisition activity in seeds reached a new, higher plateau in the eighties. The company names, headquarters location, management personnel and crop portfolios were in constant flux. Europeans acquired in America and Americans acquired in Europe. You needed a scorecard to keep track of the transactions. By this time, L. William Teweles & Co. had become thirteen people with an office in Tokyo and London. We counted more than 100 transactions, which we had initiated and managed; ultimately, the number was closer to 140.

Came the mid 1990’s the seed world was again in change. Plant biotechnology was powering ahead but the financial payoff always seemed to be just five more years out. A number of multinationals had taken off for greener pastures. Two privately held consolidators Agrigenetics and Genesis took the leadership. We helped Agrigentics acquire 14 independent seed companies and Genesis acquire 7. However, both of these consolidators expanded too rapidly and spent too generously on research. Ultimately, they were sold to those multinationals who were still acquisition oriented. In the late 1990’s, AgriBiotech followed this scenario; sort of. A case of history repeating itself.


During these turbulent years, the once "seedy" seed industry achieved a much higher profile in the financial and science communities. Seed as a buggy whip industry died. Suddenly, we were high tech and sexy.

In the very early 90’s and in early 2000, came another change; this time in the form of divestitures, spin-offs and recombinations of the remaining multinational ag companies. Once again, it was fashionable to be independent, family operated, and profitable. Those major seed companies now acquired by the multinationals earned their place in the sun by being profitable. Management saw to it that their seed subsidiaries increased their gross margins and bottom lines. The surviving independents were laughing again, all the way to their country banks. Their market shares had increased at the expense of their big brothers who now number just six or seven, down from 35 in the seventies.

Once again, in early 2002, industry leaders are again asking themselves "what’s the next big change?" and "how can we prepare our company?" If one is to judge the future by the past, I believe we will be revisiting the acquisition binge once more. The powerful science of plant biotechnology is gaining momentum. This technology is almost entirely in the hands of the six multinationals that are leading the science charge. The multi million-dollar annual research investment by these firms ultimately needs to be recouped. I expect they need to have control of the distribution of the technology envelope, in the form of seed. To deny this is to deny the history, power and success of multinationals’ activities in other industries.

I believe the next wave of consolidation will take multiple forms. There will be pure acquisitions, joint ventures, franchise arrangements, and strategic alliances. I expect the multinationals, with their enormous research investments and technology portfolios, to reassert their control of seed research, marketing, and distribution now in the hands of the independents.

In my own case, I have buried a copy of this paper in a time capsule at the site of the old L. Teweles Seed Company in downtown Milwaukee with instructions that it not be opened until Year 2020. If any of you have had the patience to read this paper and can find me at that time, I will be very interested to hear how the next change plays out.