The exciting part of Saskatchewan Wheat Pool’s takeover of Agricore United is over.
Now comes the drudgery of paperwork.
AU shareholders have been snowed under by a blizzard of documents from the Pool and James Richardson International in recent weeks and months outlining their various proposals to buy AU shares.
Some shareholders still hadn’t received a circular from AU’s board of directors urging them to accept JRI’s April 19 offer when AU struck a deal with Sask Pool on May 9 and JRI withdrew its bid.
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By the time the Pool’s May 9 offer arrives in their mailboxes, shareholders will have received hundreds of pages of documents to plow through.
That has raised concerns that some shareholders, especially farmers busy with seeding, may feel overwhelmed and confused about what to do.
“Certainly it’s important that shareholders understand that they should ignore the package from JRI,” said Colleen Vancha, the Pool’s vice-president of corporate affairs and investor relations.
“The JRI deal is off the table so this is their only offer to tender to.”
A circular from AU’s board of directors also directs shareholders to ignore the JRI documents and tender to the Pool.
Shareholders have until midnight May 28 to respond to the Pool’s offer by filling out and returning the appropriate documents.
Vancha said shareholders don’t need to wait to receive the latest circulars from the Pool and AU, which were mailed May 17, to sell their shares to the offer of $20.50 per common share and $24 per Series A preferred share.
They can use documents included with previous Pool offers they’ve received to tender their shares and still receive the May 9 prices.
Shares already tendered to previous Sask Pool offers will automatically receive the new price.
Within a couple of days of May 28, assuming the Pool offer is accepted by at least 75 percent of shareholders, the company will pay out the $20.50 and $24 to shareholders.
At the same time, holders of subscription receipts issued by the Pool to raise some $920 million in cash to finance the purchase of AU, will have those receipts transformed into Pool shares.
AU will hold a special meeting June 13 of shareholders in Winnipeg to formally register the sale of shares and to approve the continuance of AU under the Canada Business Corporations Act, rather than the UGG Act under which it now operates. Seventy-five percent approval is required in both instances.
The Pool will then purchase any unsold shares, at which point AU will become a wholly owned subsidiary of the Pool. That should happen within a few days of the June 13 meeting.
After that, the Pool will take the required legal steps to close the already negotiated deals with Cargill and JRI, selling to them a number of elevators and farm service centres for a total price of around $400 million.
AU will continue to operate after the transaction, although exactly how it will be managed remains to be determined.
“AU will still exist as a separate company, as a subsidiary of the Pool,” said Vancha.
“The Pool will be run by the Pool and AU will be run by AU and we will start working through the integration process.”
