One Winnipeg giant has swallowed another, but farmers shouldn’t think J.R. Richardson and Sons’ takeover of Bison Transport is focused on agriculture.
Rather than latching the trucking company onto its grain company and food operations, it is probably building out Richardson’s capabilities into new industries, says a veteran transportation expert.
“I don’t think they bought necessarily to fit into any kind of vertical integration of the business,” said Barry Prentice of the University of Manitoba.
“I think it was strictly a case of a really good investment and they know it’s going to make money. That’s what successful businesses do.”
The blockbuster announcement sees Bison and its 2,100 trucks and 3,700 employees joining Richardson, Canada’s biggest agricultural company, through a takeover that is expected to leave Bison with its head office and administration intact in the Manitoba capital. The company has been operated by the Jessiman family since 1969.
“I take great pride in what we have accomplished here as a team on behalf of the Jessiman family,” said Bison president and chief executive officer Rob Penner.
“(But) I think that takes a second seat to the renewed energy and excitement I have for our future as part of the James Richardson and Sons group of companies.”
That energy and excitement might be based in the much deeper pockets in the Richardson overalls, which should be able to more easily finance any expansion and innovation Bison plans to make in the future, Prentice said.
“They’ve probably grown as big as they can on their own resources,” said Prentice.
With Bison already a dominant player in Canada, it is likely seeking to increase its operations in the United States and overseas. Those markets are competitive and it’ll be good to have a well-financed parent company to stand behind expansion ventures.
There is also much interest and talk about automation coming to truck operation, with driverless trucks seen as already on the horizon. Incorporating automation would be costly, as would having the financial cushion to handle any problems or surprises, Prentice said.
While Bison operates in various agricultural industries and food businesses, agriculture is generally not seen by observers to be a likely focus for the company. Prentice doesn’t expect Richardson to try to force customers or suppliers to use Bison.
“I don’t think they would necessarily say you’ve got to use this company because we own it,” said Prentice.
“I don’t think that would be in their game plan.”
Richardson keeps a low profile in Winnipeg, despite being a gigantic corporate presence in the city and Manitoba, and indeed across Canadian agriculture. It is a major player in Manitoba’s sliver of the oil patch along the Saskatchewan border and along the North Dakota border in the southwest, as well as being a player in a number of other industries, including financial services.
It is owned by the Richardson family, whose business empire arose in the 19th century when James Richardson moved to Winnipeg from Kingston, Ont., and began grain merchandising.
“We are excited about the opportunity to acquire Bison, which has an outstanding reputation for customer service, dependability, employee relations and safety, built over the past 51 years,” said family head Hartley Richardson in announcing the purchase.
The price was not disclosed.
Over the past two decades Richardson has built a formidable array of assets, moving into a number of new businesses and industries when it has seen good opportunities to acquire good companies at good prices.