The move is subject to shareholder and member approval but, if given the go-ahead (expected in November), it will see the new company work with over 7000 farmers and handle about 4m tonnes of grain, equivalent to 20% of the UK market.
Openfield also plans to appoint DHL Exel to handle all its grain haulage and establish a central haulage “control tower” at the Colsterworth headquarters in Lincolnshire.
The organisation of current farm collections will continue, but it is hoped that road miles required to handle the same volume of grain can be cut by 10% per year.
Current Centaur chairman Richard Beldam is the proposed chairman of the merged business and Grainfarmers’ managing director Tim Davies will become chief executive.
“As our major customers continue to grow in size and influence, we have to do the same,” Mr Beldam said. “Many of them are now looking for longer-term committed supply contracts and Openfield fully intends to promote a similar expansion of the committed grain principle to support these contracts.”
There are also plans to grow Openfield’s arable inputs business which, when combined, will become the third largest supplier (by volume) of seed and fertilisers. It will also continue its commercial agrochemical supply relationship with UAP.
Mr Davies said the new company would “deliver increased value to farmers and customers alike through excellent marketing performance and logistical innovation.” It would also reduce risk and provide members/growers with a secure long-term business proposition, he said.
It was hoped there would be good integration of resources and staff from both businesses, but it was unclear whether there would be any redundancies.