A Midwestern farm lender is offering an alternative to the European buyout of Farm Credit Services of America. The proposed acquisition of the region’s biggest farm lender by Rabobank has many producers concerned. Minnesota-based AgStar, a farm credit co-op, is has a team of managers touring the region to propose a merger with the Farm Credit System. AgStar president and CEO Paul DeBriyn their new offer includes 650-Million cash that would go to stockholders when the merger takes place, better than Rabobank’s offer of 600-Million. The Dutch banking cooperative has also offered an $800-Million “exit fee” that would be paid to the federal government, if and when the Omaha cooperative agrees to leave the government’s farm credit system. DeBriynsays when AgStar first learned of the European buyout proposal it had made a competing offer, which was rebuffed. Now they’vre making another, and this whirlwind public-relations tour is touting a list of advantages to AgStar’s offer. DeBriyn says it’d provide for “patronage dividends” so stockholders would share in the lender’s success, and a locally-elected board would retain control, making decisions in their own region’s interest. He says a merger would keep the lender part of the Farm Credit System. The farm-credit system has to fulflil its public mission, to serve all the counties in its territory and provide borrowers with rights and protections important to clients, stockholders and customers, he says. The pitch for AgStar’s offer plays on the rising tide of objections about what might happen if a foreign owner had control of the lending source for farmers here. DeBryin says AgStar’s merger plan would keep control of the farm lender here at home. It would be headquartered in the Midwest, controlled and owned by a board of directors “completely in the Midwest.” AgStar of Mankato, Minnesota, serves much of that state and part of western Wisconsin but DeBriyn says it can service farm loans in the four-state area where the Farm Credit System now operates — Iowa, Nebraska, South Dakota and Wyoming. The company already owns Cedar Falls farm lender Rabo AgServices, which was known as Ag Services of America before it was sold the first of the year.
