Historic Amalgamation of Cooperative Packinghouses

(Kelowna) Four cooperative packinghouses today executed the final legal agreement for their amalgamation. The Okanagan Tree Fruit Cooperative is the culmination of decades of consolidation and mergers in the tree fruit packinghouse industry.

The new cooperative will receive, store, grade and pack over 130,000 tons of tree fruits consisting of conventional and organic apples, pears, cherries, peaches, nectarines, apricots, crabapples, prunes, plums and grapes. The wholesale value of fruit packed by the four packinghouses was $100.1 million in 2006, with shipments to Western & Eastern Canada, USA, Mexico, Latin America, Dominican Republic, Europe, South East Asia and Saudi Arabia.

Okanagan Tree Fruit Cooperative will service almost 12,000 acres of orchard land from Osoyoos in the south to Salmon Arm in the north, from Keremeos in the west to Creston in the east. The merger accounts for $54.1 million in assets and employs 640 people.

In 1957, fifty one years ago, there were thirty-six cooperative societies, twenty independent shippers, and five grower-shippers selling their product through B.C. Tree Fruits Limited. By 1972, the number of packinghouses had consolidated to fourteen cooperatives and four independent shippers. The previous round of amalgamation, to four cooperative packinghouses, occurred in 1998.

Today marks the penultimate amalgamation of the Okanagan s cooperative packinghouses a single cooperative packinghouse has been formed marketing fresh product through B.C. Tree Fruits Limited. The new cooperative needed to form to meet the competitive pressures of the marketplace. The drivers of this amalgamation are the market deman for consistently high-quality tree fruit produce and the need for improved efficiency. Now begins the work on delivering on the promise of the consolidation.

"Our staff looks forward to serving the 910 growers who will ship to the Okanagan Tree Fruit Cooperative", said Gary Schieck, CEO of the newly formed cooperative.

In the previous three years, the cooperatives formed an operating company, Okanagan Tree Fruit Company Ltd. to manage the cooperatives as a common organization. However, the cooperatives continued to keep their financial records, assets, and boards separate. Growers recently voted to merge into a single cooperative, with all packinghous assets owned by the new cooperative, and with a single board and financial reporting system in place.

An interim Board of Directors, composed of representatives from each of the existing cooperatives, will be in place until the first Annual General Meeting of Okanagan Tree Fruit Cooperative in August 2008.

The Okanagan Tree Fruit Cooperative owns and operates 6 packing facilities, in addition to 9 satellite locations with storage or warehousing. Okanagan Tree Fruit Cooperative also owns subsidiary companies B.C. Tree Fruits Limited (a broker), and Growers Supply Company Limited (a farm and irrigation supplies store).

The growers of Okanagan Tree Fruit Cooperative are members of the BC Fruit Growers Association which represents commercial orchards in BC, with a mandate to foster a business environment for the long-term prosperity of BC tree fruit growers.