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Driving Forces and Success Factors for Mergers, Acquisitions, Joint Ventures, and Strategic Alliances Among Local Cooperatives

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  • Vandeburg, Jennifer M.
  • Fulton, Joan R.
  • Hine, Susan
  • McNamara, Kevin T.

Abstract

The trend toward greater consolidation in agricultural production and in agribusiness is creating the conditions that squeeze local farm supply and grain marketing cooperatives from three directions. As farms become larger and fewer in number, each individual farmer-customer is more critical, making relationships and services offered more important than ever before. At the same time that each customer has a greater impact on the cooperative’s bottom line, the competition is also consolidating, creating a fiercer “survival of the fittest” marketplace. On the other side of the local cooperatives’ business, suppliers and grain marketing firms are also fewer and larger, limiting choice and bargaining power for local cooperatives. In response, local cooperatives are engaging in a variety in business arrangements, including strategic alliances, joint ventures, mergers, and acquisitions. This paper has two objectives. The first is to examine the driving forces that motivate local cooperatives to get involved in strategic alliances, joint ventures, mergers and acquisitions. The second is to examine the relative importance of factors in the success of these new business arrangements.

Suggested Citation

  • Vandeburg, Jennifer M. & Fulton, Joan R. & Hine, Susan & McNamara, Kevin T., 2004. "Driving Forces and Success Factors for Mergers, Acquisitions, Joint Ventures, and Strategic Alliances Among Local Cooperatives," Research Reports 280090, United States Department of Agriculture, Rural Development.
    • Handle: RePEc:ags:urdbrr:280090
    DOI: 10.22004/ag.econ.280090
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    1. Cummins, David E., 1993. "Corn Belt Grain Cooperatives Adjust to Challenges of 198Os, Poised for 1990s," Research Reports 279975, United States Department of Agriculture, Rural Development.
    2. Fulton, Joan R. & Popp, Michael P. & Gray, Carolyn, 1996. "Strategic Alliance and Joint Venture Agreements in Grain Marketing Cooperatives," Journal of Cooperatives, NCERA-210, vol. 11, pages 1-15.
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    Cited by:

    1. Elena Meliá-Martí & Natalia Lajara-Camilleri & Ana Martínez-García & Juan F. Juliá-Igual, 2021. "Why Do Agricultural Cooperative Mergers Not Cross the Finishing Line?," Agriculture, MDPI, vol. 11(11), pages 1-19, November.
    2. Elena MELIA-MARTI & Ana Maria MARTINEZ-GARCIA, 2015. "Characterization And Analysis Of Cooperative Mergers And Their Results," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 86(3), pages 479-504, September.

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