Proposed merger of co-ops in Rimouski and Trois-Pistoles against a backdrop of controversy

We don’t want to condone this.told us on condition of anonymity one of the four resigning directors.

As a whole, they decided to leave their functions at the end of a stormy meeting of the board of directors on March 29, learned Radio-Canada. The vote to merge was narrowly won five to four.

The former administrators fear that the heavy debt of the Trois-Pistoles Co-op will weigh down the assets of the Rimouski cooperative which, unlike its neighbor, recorded a profit of more than a million dollars last year. .

The only study we had was a financial study, but we did not have the others, for example a market study that would have allowed us to make an informed decision for both Rimouski and Trois-Pistoles.added the former member of the Board of Alimentation Coop Rimouski.

It must be said that business is rather bad for Magasin Co-op de Trois-Pistoles, the official name of the company. And it has been for a long time.

In 2021, the coop recorded an operating deficit of nearly $500,000. The previous year, it was $653,000. The merger with Rimouski is therefore a lifeline for Magasin Co-op in Trois-Pistoles.

But the big winner of all this will be Sobeys., told us another source near the file. Because if there is a merger, the Canadian food giant which operates the IGA banner would obtain reimbursement of its debt contracted with the Trois-Pistoles cooperative, an amount which exceeds 3.5 million dollars.

Sobeys also imposed an interest rate of 9% on the co-op of approximately 3,000 members.

The merging cooperatives have common economic, social and cultural interests and serve an identical clientelespecifies the merger agreement of which Radio-Canada obtained a copy.

A member vote, but only in Trois-Pistoles

Only the members of Trois-Pistoles will be called upon to decide on the merger, on May 19. If they accept, it could come into effect as early as June 6.

However, there is no plan to seek the opinion of the members of Alimentation Coop Rimouski. The merger agreement stipulates that the vote of the directors of the acquiring cooperative is sufficient, even in the event of a split result of five votes to four, as was the case during the March vote.

This is also what the Cooperatives Act provides for in such circumstances.

But the fact that the members of the Rimouski co-op are not arrested makes the resigning directors uncomfortable.

The Trois-Pistoles cooperative could be absorbed by that of Rimouski thanks to a single majority vote on the board of directors.

The absorbing cooperative acquires all the rights, property, interests, privilegesbut in return, she becomes responsible for the heavy debt.

A first?

This could be the very first merger of cooperatives in the food industry in Quebec, at least in recent decades.

The trend is well underway for agricultural cooperatives, among others, and the wave is expected to spread to the retail trade.

This will be a trigger eventbelieves Michel Ferland, the director-general of the Federation of Quebec Food Cooperatives (DCAQ), which brings together 78 member companies from all over Quebec.

According to him, it is increasingly difficult to maintain local services, due, among other things, to the shortage of labor and the rise in the price of foodstuffs. He believes that the merger is a solution to counter these difficulties.

” Anything that allows us to consolidate the presence of the cooperative movement in food, including the merger, we see that with a favorable eye. »

Michel Ferland concedes that until now, the merger was not necessarily considered by its members, but with what is happening in the agricultural world, he is convinced that other mergers will occur in the coming years.

Organizations that unite allow them to then engage in growth projects, because the more they are consolidated in their environment, the more they will have the strength to expand their influence.

The president of Alimentation Coop in Rimouski, Jean-Roch Michaud, did not wish to grant us an interview for the moment, as did the four former administrators opposed to the merger.

Alimentation Coop Rimouski operates two grocery stores and two gas stations.

The president of Magasin Co-op de Trois-Pistoles, Serge Bélanger, did not answer our calls.

Sobeys’ communications manager said a company representative would speak at the members’ meeting in Trois-Pistoles, but no comments would be forthcoming.

If the members of Magasin Co-op de Trois-Pistoles vote in favor of the merger, the project will be sent to the Minister who will have to ratify it, which generally constitutes a simple formality.