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Winnipeg, Manitoba
November 1, 2001
Agricore United is pleased to
announce that Agricore and UGG completed today their previously
announced merger transaction to form western Canada's leading
farmer-directed agri-business.
The merger proposal was announced July 30, 2001 after the Boards
of both UGG and Agricore gave their unanimous support for the
merger. On August 30, the shareholders and delegates of Agricore
approved the merger, paving the way for today's announcement.
Agricore United is pleased to have reached an agreement with the
Commissioner of Competition which allows the merger of Agricore
and UGG to proceed. In order to address certain concerns raised
by the Competition Bureau, Agricore United has agreed to divest
up to seven primary grain handling elevators in Western Canada
and one port terminal elevator in Vancouver. The Commissioner
will shortly apply to the Competition Tribunal for a Consent
Order requiring the divestiture of the country elevators. The
Commissioner will also apply for an Order requiring divestiture
of a port terminal in Vancouver. The Tribunal will be asked to
determine what assets are required to be divested to address the
Commissioner's concerns in Vancouver. Certain terms relating to
the divestitures will remain confidential to allow for a fair
and balanced divestiture process.
Under the terms of the merger agreement, members and
shareholders of Agricore have exchanged, effective today, their
equity in Agricore for approximately 20.5 million shares of UGG
operating as Agricore United. As a result of the exchange,
Agricore United has approximately 37.3 million shares
outstanding.
Agricore shareholders and equity-holding members will be mailed
their new share certificates in late November. Agricore United
will also be establishing an assisted sales program to enable
those former Agricore shareholders and equity members who wish
to sell their Agricore United shares received in connection with
the merger, to do so in an orderly manner. A letter will be sent
shortly to Agricore shareholders and equity members advising
them of the number of Agricore United shares they own and
setting forth the details of the assisted sales program.
The new board of directors of Agricore United will hold its
first official meeting tomorrow, at which time the Chairman and
President, First Vice-President and other members of the Board
executive will be elected.
The senior management team, led by CEO Brian Hayward, is in
place. "Our immediate goal is to ensure the merger integration
process is completed as smoothly and quickly as possible," says
Hayward, "so that customers and shareholders of Agricore United
can soon begin to capture the benefits."
Agricore United will be holding its inaugural annual
shareholders' meeting and members' meeting in Saskatoon on
November 7 and 8.
In connection with the completion of the merger, Agricore United
has entered into new credit facilities to replace certain
existing credit facilities of Agricore and UGG. Agricore United
believes that there are many attractive investment opportunities
in the Canadian agri-business industry. Over the next several
months, the new Agricore United Board will consider other
additional sources of capital in order to better position itself
to take advantage of these opportunities. These additional
sources of funding may include, but are not limited to, a
treasury offering of limited voting common shares.
Agricore United is western Canada's leading farmer-directed
agri-business. The prairie-based company is diversified into
sales of crop inputs and services, grain merchandising,
livestock production services, and farm business communications.
Agricore United's shares are publicly traded on the Toronto
Stock Exchange under the symbol "UGG".
Company news release
N3930
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