May 7 due date | Third party review is expected to cost $125,000 and will be in addition to two reviews set up by the federal government
The Saskatchewan government will rely on an independent review of the proposed Viterra takeover to decide if the deal is in the best interests of the province.
Premier Brad Wall said March 29 that Informa Economics will conduct the review at a cost of $125,000.
The report is due May 7 and will be released to the public.
Wall said the government has expertise to draw upon in the agriculture, finance and justice ministries, but third party counsel is also important.
“We just want to make sure we’ve looked at every angle,” he told reporters, saying it is the responsible thing to do.
Glencore announced March 20 it intended to buy Viterra for $6.1 billion and then divide the assets with Richardson International and Agrium.
The deal will undergo two federal reviews, one to examine the foreign takeover aspect and the other to look at competition issues.
Although the province has no formal standing in either of the reviews, Wall said the government is obliged on behalf of taxpayers to make public what its analysis shows.
He said his rural caucus has heard from a few farmers concerned about competition, mainly over Agrium’s takeover of 232 of Viterra’s 258 agri-product retail locations. The company would have 297 locations if the deal proceeded as proposed.
“On the grain handling side, frankly, we’ve had MLAs report that producers are kind of encouraged that this market will become more diffused because Viterra’s market dominance is actually going to be scaled back a bit potentially if the deal goes as proposed,” Wall said.
The Informa review will identify the risks and benefits of the deal to grain industry employees and farmers and will examine competition in grain handling and crop inputs. It will also look at how the deal would affect government revenues, the province’s strategic position in the international grain industry and its reputation for having a positive investment climate.
It will also identify the options available to mitigate the risks or act on the opportunities.
Wall said Viterra jobs that moved to Calgary could move back to Regina because Glencore has said the Saskatchewan capital will be its North American head office.
He expects the federal reviews to take several months.
NDP leader John Nilson said the premier should stand up for Saskatchewan and the analysis is a step in the right direction. However, he said it comes too late.
“This kind of a review relates to what should have been a plan before to deal with the consequences of the elimination of the Canadian Wheat Board,” he said.