4. United Fresh, PMA merger falls through - The Packer

4. United Fresh, PMA merger falls through

12/28/2012 12:21:00 PM
Greg Johnson

While United Fresh leaders say PMA’s insistence that Bryan Silbermann be appointed the new chief executive officer of a merged association was the only reason a merger didn’t happen, PMA merger task force chairman Mike O’Brien, immediate past PMA chairman, said there was no place for blame in the negotiations. “Honestly I believed that we would be able to accomplish a merger and that PMA and United would be stronger working together,” O’Brien said July 18.

“However, in the end we weren’t able to accomplish this.”

“Our goal is to move forward and do what is right for the membership of PMA,” said O’Brien, vice president of produce and floral for Schnuck Markets Inc., St. Louis.

“The joint task force negotiated all other provisions except for one and couldn’t come to agreement ... on the future leadership of the new association,” said David Krause, president of Paramount Citrus, Delano, Calif., and chairman of United Fresh.

O’Brien said he couldn’t say that PMA’s insistence on Silbermann as the leader of the new group was the only reason the merger didn’t happen.

PMA’s board felt having the most powerful and sustainable single association demanded the leadership of Silbermann, O’Brien said, noting that PMA and United Fresh agreed in February 2011 to the principle of selecting the chief executive officer of the merger group in advance.

While the leadership issue was identified early on as a potential problem for the negotiations, the process stalemated within the task force and later with the groups’ full boards, Krause said.

PMA’s board proposed June 29 a plan to install its CEO, Silbermann, as chief executive of the merged group, Stenzel said. The United Fresh board rejected that July 6 and countered with a proposal that would have left the position open until the 40-member board for the merged association was in place.

“PMA rejected it and hadn’t voted on our proposal and were standing on original (plans),” Krause said.

Rich Dachman, chairman of PMA and vice president of produce for Sysco Corp., Houston, said concerns focused on the strategy PMA is built on, and that it would not be continued in success without Silbermann.

“For us, it was about continuing our strategy successfully,” Dachman said. “That was the board’s main concern, that it would not happen if it wasn’t done in the way we proposed.”

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