UPDATED: PMA, United Fresh resist urge to merge

07/16/2012 01:11:00 PM
Tom Karst

(UPDATED COVERAGE, July 17, 2:50 p.m.) Merger talks between United Fresh Produce Association and the Produce Marketing Association are over, with United Fresh leaders saying PMA officials would not agree to a proposed plan.

“We are disappointed that in the end, PMA’s current leadership did not agree with what we believe was a very fair, member-oriented plan that could have blended the goals and priorities of both associations,” according to a statement issued mid-day July 17 by David Krause, United’s chairman, and Ron Midyett, chairman-elect.

“Without that commitment from our friends at PMA, the United board could simply not abandon the principles that have guided our association for more than a century,” the sstatement said.

Earlier in the day PMA confirmed the talks were at an impasse.

“I acknowledge with profound disappointment that despite our best efforts we were unable to agree on an acceptable joint association model that would meet both member and industry needs,” Mike O’Brien, chairman of the PMA task force considering the merger with United Fresh, said in a statement e-mailed to PMA members.

O’Brien, immediate past Produce Marketing Association chairman and vice president of produce and floral for Schnuck Markets Inc., St. Louis, said PMA remains committed to “building collaborative relationships with all our association partners in the U.S. and abroad.”

O’Brien did not address specific reasons for the failure of the negotiations.

Later in the day July 17, United sent an e-mail to its membership over the signatures of Krause and Midyett, along with United’s board members, saying: “We are disappointed in this outcome and believe it is important that you hear directly from us about the end of these discussions and our plans for moving forward. ... Going forward, we believe that United Fresh is the association that can best help you achieve those goals through our unique member leadership of some 350 volunteers, the commitment of our dedicated staff, and the array of programs for our industry in key strategic areas...” the e-mail to United members said.

In reports of recent negotiations, the PMA board of directors insisted that Bryan Silbermann to be put in place as the permanent chief executive officer of the merged group.

However, the United Fresh board could not agree to that scenario and wanted to have the combined group’s board of directors choose the new leader, according to two people familiar with the discussions. Because PMA would not bend on that demand, United Fresh voted to suspend further negotiations on July 14, one source said.

The merger talks have been ongoing since February 2011, led by O’Brien and Steffanie Smith, immediate past chairwoman of Washington, D.C.-based United Fresh and former chief executive officer of River Point Farms LLC, Hermiston, Ore.

The failed talks proceeded further than any previous efforts to combine the groups, which was also attempted in the early 1990s and the early 2000s. The group agreed on many aspects of a merger but could not get past the leadership question.

Produce marketing companies had hoped that combining the two groups would result in economies and efficiencies. Duplication of efforts in government relations, food safety expertise and trade show conventions frustrated some in the industry.

In May, sources said that some large produce marketers have reportedly told United Fresh and PMA to find a way to get the deal done or they will pull their support from both groups, and industry sources said that threat was a primary impetus for the merger discussions.

Jan DeLyser, vice president of marketing for the Irvine-based California Avocado Commission and chairwoman elect of the PMA, said the merger talks have been conducted with diligence by both boards.

“As a marketer in my own company, we have looked at the programs and organizations that bring value to our membership and for the people we are reporting to and we make the decision on our participation and our support based on that,” she said. “We are active members in both organizations.”

Staff writer Coral Beach contributed to this article.



Comments (4) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left

Merge!    
USA  |  July, 17, 2012 at 10:10 AM

It seems irresponsible to the industry that they would get hung up on leadership. Imagine how strong and effective one large group would be for the industry. Feels like we are in Congress, can't cross the isle for the good of the whole.

Merge agree    
U.S.  |  July, 17, 2012 at 02:14 PM

agree completely. We are one industry, it's too bad not all see it that way. We should be focused on long term success of the industry not individual jobs or current appointed positions.

Avi Crane    
California  |  July, 17, 2012 at 10:27 AM

The Produce Industry is blessed with two long standing trade associations that continue to lead our industry forward. At the head of these organizations are two exceptional leaders who have much to offer our industry in the coming years. The rationle for the merger of our two organizations has been well articulated and Steffanie and Mike are extremley able professionals with a common goal. Let us all urge these negotiations to continue and succeed.

Tim Vaux    
Fresno, CA  |  July, 17, 2012 at 11:03 AM

The combined leadership of both organizations should be enlightened enough not to let this be a stumbling block. Open the CEO position for the combined organization to a national search and let the chips fall where they may.

Feedback Form
Leads to Insight