Open letter to Agricore United customers:

On November 7, 2006, Saskatchewan Wheat Pool (SWP) announced through the media its intent to take over Agricore United through a share exchange. They are calling it a merger. It isn’t. It is a hostile proposal.

We know the difference. A friendly merger includes open dialogue between both parties, exchange of information to determine fair value for both sides and ironing out important issues such as Competition Bureau concerns prior to making an announcement.

We have had no conversation with SWP on this proposal. So far, we have only an announcement of an intention to make an offer and very few details.

There are two things you need to know now. The first is that there is a long process ahead once we actually receive the offer including careful review by our Board of Directors on behalf of shareholders and other stakeholders, as well as review by the Competition Bureau. The second is that, in the meantime, nothing will distract us from serving our customers and running our business.

The timing and intent of the hostile proposal is not a surprise - SWP clearly wants to be part of our growing momentum and take a piece of our success. Agricore United is Canada’s largest grain handler and a leading provider of crop inputs to our farmer customers. We are a global agri-business with customers in over 50 countries. We are Canada’s largest exporter of canola - a crop that now rivals wheat in its economic importance. Our grain merchants work in 12 languages; we operate offices in Tokyo and the United States.

We’re a company that both farmers and investors can trust. We’ve proven we can manage through extremely tough times. We promised at the time of the 2001 merger that we would pay down debt while continuing to grow as a company. We’ve done that and we’re continuing to do that, while at the same time regularly issuing dividends to our shareholders. We promised to look for economies of scale that would benefit our customers. With our strategic alliance with various seed and chemical companies, we are delivering on that promise as well.

During the past year the Agricore United board of directors, 12 out of the 15 of whom are elected farmer members, and senior management team went through an intensive strategic planning process. We have a very clear direction of where we’re heading as a company, which we have distilled down to a single sentence: Agricore United’s overall strategic intent is to grow by adding value to agricultural production.

We intend to stick to this path. When we say “it is business as usual at Agricore United” what we really mean is “we’re going to continue providing our customers with the best service, products and agronomic advice possible, now and long into the future.” Through our heritage companies, Agricore United has been around for 100 years and our values continue to be solid. Our word is our bond. We promise to keep you informed as we work our way through what we expect to be a long process.

Wayne Drul, Chair Agricore United (and)
Brian Hayward, Chief Executive Officer Agricore United