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CCCA_V2No2_Agribusiness-FIN.qxd:CCCA_V1No1_DriversSeat-FIN.qxd 5/1/08 2:47 PM Page 46 Feature We are partnering with people that we have a great deal of confidence in, that do have proper patents in place and that will be protecting them if they are infringed upon. Jean-Marc Ruest Vice-President, Corporate Affairs and General Counsel James Richardson International Ltd. Winnipeg A new era tied up in their farm, but they don’t necessarily have the next James Richardson International (JRI) is a prime example of the generation that wants to use that to take over the family farm,” change, says the company’s vice-president, corporate affairs and Warsaba says.“As a result,I think that the transactions we’re going general counsel Jean-Marc Ruest.The Winnipeg-headquartered to be seeing are more complex. I think there are lots of investors, company was started 150 years ago by James Richardson, a tailor both big and small,that are looking to get into the sector because from Kingston, Ontario, when he began accepting grain as a they want to participate in some way.” method of payment for suits. Today, it’s Canada’s largest privately owned grain handling Wave of consolidation company and the second-largest grain handler overall.JRI is only For evidence, look no farther than the bidding war last summer one example of the shifting paradigms arising from an economic for grain giant United Grain Growers Ltd. (carrying on business boom.Wheat and soybean prices rose almost 80% last year and as Agricore United (AU)). In the end, Saskatchewan Wheat Pool corn is at its highest prices in more than a decade. Inc. (SWP) acquired the estimated $1.8 billion company and “It’s funny — you’re so used to hearing the farmers complain, merged it with its own operations to form Viterra, the largest because they have always got some legitimate crisis to deal with,” grain handling company in the country. says Leslie O’Donoghue, senior vice-president, general counsel This year,Viterra is expecting sales of $4 billion and has 42% of and corporate secretary at Agrium in Calgary. “You certainly the market share of the top six grains in the country.The majority don’t hear much of that now.” of the company’s agricultural purchases are fromWestern Canada. Along with the changed outlook have come new insights into Even JRI — which was unsuccessful in its competing bid the ways the law has and must change to properly serve an indus- for Agricore — has come out ahead.A subsequent agreement with try where mom-and-pop farms are getting bigger and attracting SWP allowed the company to purchase approximately one-third of corporate investors. Agricore’s assets and grow the corporation by about 50%,says Ruest. Patricia Warsaba, a partner with Robertson Stromberg Agrium has also played a part in the industry’s general consolida- Pedersen LLP in Regina, says corporations are raising money tion. In 2006, it acquired Royster-Clark, creating Canada’s largest through IPOs for the express purpose of purchasing farmlands. retailer of crop inputs.A current takeover bid for UAP Holdings is Land ownership restriction law changes in Saskatchewan, which awaiting approval from the U.S. FederalTrade Commission. made it possible for non-Saskatchewan residents to purchase land O’Donoghue notes that the state of the market presents unique have helped, she says. But one of the keys has been social change. challenges to counsel.“In a frenzied market, the challenges are to ROBERT TINKER ”There’s a whole generation out there that has lots of capital buy at the right price and to buy at the right point in the cycle. 46 CCCA Canadian Corporate Counsel Association SUMMER 2008