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facilities to Boone Valley for $29.1 million. Petitioner
was then to purchase Boone Valley's Eagle Grove, Iowa,
feed mill for $10 million, and Boone Valley was to change
its name to Ag Processing, Inc. (API). Petitioner, Land
O'Lakes, and the former patrons of Boone Valley were to
receive all of the equity in API. The record does not
disclose the consideration paid by Land O'Lakes for its
interest in API.
The soybean consolidation plan was effectuated in
August 1983. Petitioner's annual report for 1983 states
that the consolidation of the three regional cooperatives
into a single entity “would [eliminate] some duplication
of effort and [create] a stronger cooperative soy
processing entity that will improve producers’ return.”
Petitioner estimated that the consolidation would provide
additional savings of 3 to 5 cents per bushel for soybean
farmers. Following the consolidation, petitioner's
patrons marketed soybeans through API. API operated the
soybean facilities and sold a substantial portion of its
output to petitioner for resale to its member
cooperatives.
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