The firms GS agri eG (based in Schneiderkrug) and Agravis Raiffeisen AG (based in Münster and Hanover) are reviewing a close cooperation arrangement in the compound feed business in the Weser-Ems region.
Specifically, two joint venture companies are to be established – a production company based in Oldenburg and a compound feed company based in Schneiderkrug. The 16 regional Raiffeisen Cooperatives already participating in the present-day Agravis Kraftfutterwerk Oldenburg GmbH are to become co-shareholders in both companies.
The targeted merger would result in a regional compound feed producer producing around 1.3 million tonnes of compound feed for all animal species at five locations – Leer, Oldenburg, Schneiderkrug, Höltinghausen and Garrel. The envisaged compound feed company will assume the procurement and optimising of compound feed and advisory services in the Weser-Ems region. The cooperation arrangement is subject to the decisions of the relevant bodies in both partners and approval by the German Federal Cartel Office. The new companies are to start operations in the second half of 2018.
”We are convinced that pooling the cooperative know-how in the production of compound feed as well as the advisory services and the portfolio is the right step in order to be a strong and long-term partner for farming in the Weser-Ems region“, affirm Andreas Rickmers, Chairman of the Managing Board of Agravis Raiffeisen AG, and Cord Schiplage, Managing Director of GS agri eG, in a joint press release. At the same time the two pointed out that farmers will naturally continue to purchase the compound feed via the cooperatives.
The compound feed business is faced with major challenges. Alongside rising demands from society, such as for instance GMO-free feeding, the pair refer to the pressure of competition which is being additionally sharpened in the medium to long term by the creation of ever greater capacities with the prospect of declining numbers of animals. Agravis, GS agri and the participating Raiffeisen Cooperatives aim to counter this through efficient production and a powerful portfolio. ”The synergies resulting from this together with the increases in efficiency are to help ensure that the agricultural sector can continue to enjoy optimal service, support, consultancy, and supply and delivery in the compound feed segment“, explains Cord Schiplage. For Andreas Rickmers, the targeted cooperation arrangement is a further module in tackling the structural change and the ever fiercer displacement competition through a close cooperative alliance. He explains that this means there will be a strong and capable partner with a lean organisational structure ready to assist the farming customers in the region on a stable long-term basis. The sustainable boosting of efficiency will make the partners even better equipped to respond to the rising demands of the market and impress the customers with innovative feed concepts.