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Roy Myers: A growing experience at Curtice Burns

Myers, an executive vice president with Curtice Burns and Pro-Fac’s general manager, ended up fighting for Pro-Fac and the growers against Curtice Burns, led by President and CEO William Petty.
During this period, Myers endured more than lengthy and difficult negotiations. He also suffered a broken wrist he sustained while walking his dog, an acute case of food poisoning during a trip to New York City, and an emergency appendectomy.
“We told him we had to get this over with or it would kill him,” jokes Thomas Hampson of Harris, Beach & Wilcox, friend and company counsel for more than three decades.
But Myers survived the ordeal and survived it well, associates say. Now he is walking with a crutch, thanks to a ligament torn during a hunting trip. But the limp has not slowed him down in his effort to turn Curtice Burns, now owned by Pro-Fac, away from its tumultuous past and toward a more profitable and farmer-friendly future.
Curtice Burns and its predecessors have been a part of Myers’ life for 40 years.
After spending four years in the U.S. Air Force following high school, Myers began working for Haxton Foods Inc. in Oakfield. In early 1958, Haxton, Curtice Brothers Co. of Rochester and Alton-based Burns-Alton Corp. discussed merging their small fruit-and vegetable-processing firms to better compete in the market. Under the consultation of the Cooperative Grange League Federation Inc., now known as Agway, the companies also entertained the idea of forming a joint venture with farmers.
When owner George Haxton died, Haxton Foods withdrew from discussions. Curtice Brothers and Burns-Alton went ahead with the consolidation, however, and Pro-Fac Cooperative was organized to jointly own and control processing facilities.
In 1962, Pro-Fac purchased Haxton Foods.
Over the years Myers has done everything from working in the company accounting department, to managing personnel, industrial relations and operations. He even ran a plant for a short time.
“I guess I’ve worked in just about all aspects of the business,” he says, adding he just might be able to run one of the processing lines.
“He’s come up through the ranks,” says Stephen Wright, senior vice president of procurement for Curtice Burns and Pro-Fac’s assistant general manager. “I think that’s given him a real sense of the type of business we’re in.
“He’s in touch with the public, especially farmers. I think he has a tremendous understanding of the relationship between processor and growers.”
That understanding is what enabled Myers to represent the growers of Pro-Fac so well during recent negotiations, associates say.
Curtice Burns and Pro-Fac had been operating under a contract for some 30 years. Pro-Fac owned the facilities and leased them to Curtice Burns. With the agreement Curtice Burns had a guaranteed source of raw products from the growers, and Pro-Fac had a guaranteed market for its crops.
The two parties shared profits, as well as losses, based on the 50-50 equity they supplied. The company posted net sales of $829 million in fiscal 1994, with net income of $10 million.
Agway had received a one-third stake in Curtice Burns years ago for bringing the parties together and for providing some of the start-up finances. In 1992, Agway decided to sell its shares as part of a major restructuring.
Pro-Fac wanted to buy Agway’s stock, but Curtice Burns, publicly held since 1973, offered the entire company for sale in pursuit of the best deal for its stockholders.
A sale to an outsider threatened the live-lihood of Pro-Fac’s more than 700 growers, including 250 in New York alone, Myers says. Farmers–the majority in Genesee, Orleans and Ontario counties–faced the loss of their markets, as well as their share of earnings under the long-standing contract.
A deal with Illinois-based Dean Foods Co., the top contender, could have meant the close of area processing plants, and possibly the shutdown of Curtice Burns’ headquarters in Monroe County, he says. Dean also would have placed Curtice Burns’ Nalley’s Fine Foods division on the selling block for Minnesota-based Hormel Foods Corp. to snatch up.
Meanwhile, Petty said Curtice Burns had trouble attracting investors while obligated to share profits with the cooperative. Farmer opposition to consolidation also made operations decisions difficult.
Curtice Burns fielded offers from a number of companies, including Pro-Fac. Dean made the highest offer at $20 a share, but Pro-Fac blocked the deal, arguing that Curtice Burns owed the cooperative half the profits of the sale to pay off $86 million in long-term debt due to Pro-Fac. Curtice Burns said no such provision existed in their contract, but Dean would not follow through with the purchase until Curtice Burns and Pro-Fac resolved their dispute and terminated their agreement.
Last August, Pro-Fac raised its bid for Curtice Burns to $19 a share. Faced with continued arbitration over the Dean deal, Curtice Burns opted to accept Pro-Fac’s offer. It now is a wholly owned subsidiary of the cooperative.
Throughout the dealings, Myers was a pillar of strength and stability, Wright says, pointing to his sense of humor and positive attitude.
Hampson adds that Myer’s stamina, which held up despite food poisoning and that uncooperative appendix, was key.
“He was just under extreme stress,” Hampson says. “(But) he didn’t lose his temper and he didn’t wilt under pressure. He got through it extremely well.”
Myers was determined to succeed, says Donald Wickham, former president of Pro-Fac and director of Curtice Burns, now vice president and co-owner of Globe Travel Service. Myers cancelled a trip to Alaska he and his wife, Anne, had planned with Wickham and several other couples. Myers could not afford to leave the cooperative behind at such a crucial time, he told Wickham.
“Roy just put his whole life into solving this problem,” he says. “I think if he hadn’t, (a deal not in the best interest of Pro-Fac) probably would have gone down awhile ago.”
Myers says he was just doing his job.
“William Petty was given a Curtice Burns hat to wear, I was given a Pro-Fac hat to wear,” he says. “He did an excellent job of representing Curtice Burns stockholders. In doing that, (he) just wasn’t compatible with Pro-Fac’s thinking or with Pro-Fac’s goals.
“Bill chose to retire after the deal was put together.”
When the deal between the two parties went through, Myers replaced Petty as president and CEO of Curtice Burns.
More than management has changed at Curtice Burns. The company’s operating strategy has been revamped as well.
Before Pro-Fac’s acquisition, Curtice Burns was restructuring to rebound from a $23.8 million net loss it suffered in fiscal 1993. The restructuring included the sale of the National Oats cereal business and the Hiland Potato Chip Co. in 1993, and the meat snacks division in 1994, to become more sharply focused and more profitable.
But the old regime, as Myers calls it, also was looking to exit certain crops, he says. Curtice Burns last March announced it would terminate a number of crops for the 1995 growing season, including all New York vegetables and fruits, except peaches.
The company contended that not all bidders for Curtice Burns were interested in keeping businesses relying on those crops.
Now, Curtice Burns views vegetables as a viable commodity and plans to increase its profitability by maximizing production and being more aggressive in its private-label business. Private-label vegetables might lack glamour, Myers says, but still be the way to go.
Management continues to review the company’s product lines, and it recently restructured the sales and marketing departments of the Comstock Michigan Fruit and Nalley’s Fine Foods divisions, he says. But no more divestments are planned.
Instead, Curtice Burns likes what it sees–in particular, the growth potential of Rochester-based Comstock. Its new line, Cranberry Classics fruit pie fillings and toppings, did well when test marketed and will be expanded this year.
The continued health of Comstock, Curtice Burns’ largest division, is of great importance to the Rochester area, Myers says. Of the raw product Comstock purchased last year, 42 percent–or $26 million–came from local farmers.
Also in the Rochester area, Finger Lakes Packaging, which manufactures food containers for Curtice Burns, plans to increase its business with other companies.
Further changes may come with the help of outside sources.
“One of the benefits of going through this change of control is we’ve earned the interest of several Fortune 500 companies,” Myers says. “As a result, we are working on strategic alliances with some.”
Though he would not reveal which companies have expressed an interest, Myers says an alliance would benefit both businesses by improving distribution channels and taking advantage of each other’s brand names.
For example, Nalley’s chilis and stews sell well in certain markets. Another company could use the Nalley’s name to market its non-competing meat products in the same area, he says. Or, Myers adds, think of the gains that could be made by combining Ocean Spray’s name with Cranberry Classics pie fillings.
Talks with other companies are in the early stages, Myers says, but he hopes to have something up and running by the end of the fiscal year in June.
“It seems like every company is trying to improve their bottom line through alliances with major companies,” he says.
Curtice Burns’ earnings before adjustments for fiscal 1995 are ahead of expectations by 9 percent, Myers says. The company’s health has pleased financiers of the acquisition, including Springfield Bank for Cooperatives, which contributed $260 million, and senior subordinated debt securities holders worth $160 million through Dillon, Read & Co. Inc.
One thing unchanged at Curtice Burns and Pro-Fac is the two-board structure, Myers says. Investors and bond holders insisted growers and processors remain separate. In the past, cooperatives that failed were those that allowed farmers to do the marketing instead of sticking to growing, which they do best.
The agreement between Pro-Fac and Curtice Burns also remains intact, he says. After conducting a nationwide study, Cornell University researchers concluded that the agreement between Pro-Fac and Curtice Burns is the best and most sophisticated for determining the transfer price of product.
The agreement serves the growers well, and Myers says they deserve it.
“I have a lot of respect for farmers,” he says. “They gamble every day of the week. They’re up against the weather, crop disease–anything can happen to damage their crop.”
Myers grew up on farms in Elba and Oakfield, which may account for part of his compassion, he admits, though he did not want to pursue farming as a career. Instead, he studied accounting at the State University of New York at Buffalo while working for Haxton Foods.
A set of circumstances–including a broken leg, the birth of twin sons and the sale of Haxton and subsequent move to Rochester–kept Myers six hours short of receiving his diploma.
But today, friends say nothing keeps Myers from doing his job or enjoying his family–a wife, four children and five grandchildren. Neither has the recent ligament injury stifled his desire to continue outdoor activities like hunting and fishing. He plans to pursue both, as well as woodworking, when he retires.
But when that will be is a mystery.
“Until the changes (between Curtice Burns and Pro-Fac), I thought I might retire early,” he says. “But once (the buyout process) started, I realized someone had to stay and fight the battle.”
In all his years with Curtice Burns and Pro-Fac, Myers never seriously considered working somewhere else.
“I (always said) if I got up in the morning and I was unhappy about going to work, I would change jobs. There might have been a few days going through the change of control …” He lets the words trail off, and laughs.
“Looking back on it, it was a growing experience. But I wouldn’t want to go through it again.”
[Rochester Business Journal Profile, Feb. 17, 1995]

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