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AOBA/ARI Releases Strategic Planning Update

The following AOBA/ARI Strategic Planning Update was recently released. To view the results of the survey, please visit the AOBA website.

February 26, 2013
Background
As you will recall, in January 2012 AOBA and ARI conducted a joint survey of their Members to gather feedback on how to best move the alpaca industry forward; a total of 1049 responses were received.
The consensus of the survey feedback was that a more unified alpaca industry would create economies of scale, translating to both economic and service benefits to the respective Members.  Based on that feedback, the AOBA Board and the ARI Board engaged a strategic planning consultant and conducted two planning retreats to identify business model options for a more unified alpaca industry.  These retreats were attended by the full Board of each Association as well as each Association’s Executive employee.  The retreat concluded with the identification of three business models for further evaluation.  They were:

Strategic Partnership
Holding Company
Consolidation either through merger or acquisition

Business Model Evaluation Process
Each Association identified three Board Members to participate in a Joint Planning Committee, staffed by the respective Executive employee of each Association. The charter of the Committee was to further analyze the financial, service and managerial obligations of each model, keeping in mind the specific survey goals of a unified industry, with economic and service benefits to the Members.  The Committee was to recommend a model most likely to achieve those goals.

Beginning in August of 2012 until January, 2013, the Committee met on a bi-weekly basis to analyze the merits of each model. Lawyers representing each Association opined that the Holding Company model would be cumbersome and least likely to achieve any economies.  They recommended that it not be pursued as an option.   The Committee and both Boards agreed and removed that option from consideration.

The two remaining options were then evaluated.  The Merger/Acquisition model was narrowed to Merger as the lawyers for each Association recommended it would be easier to accomplish, at less cost and in less time.

The Committee engaged in an in-depth analysis of the Merger model and the Strategic Partnership Model.  Much research was done.  Additionally, the implementation and operational costs of each option were considered, while developing a “benefit-drawback” evaluation tool and decision matrix.  Committee members studied this tool, and the results were tabulated with a mathematical assessment.

Recommendation
The Joint Planning Committee recommended that the business model option “Merger” be pursued further.  That recommendation was recently approved by both the AOBA Board of Directors and the ARI Board of Directors.   Both Boards have agreed that the best model to develop further is Merger.

Next Steps
Much work has yet to be done before either Board would be prepared to make a recommendation to their Membership regarding a merger of the two Associations.  We are currently developing a non-disclosure document to assist both Boards through the due diligence disclosure process and are working with legal counsels from both organizations in the development of a Plan of Merger and potential Bylaws.

A final affirmative recommendation of both Boards will be necessary to advance a Merger proposal.  This Merger proposal would then be put to the respective Memberships for a vote. 

AOBA Board Members

Libby Forstner, President
Scott Miller, Vice-President
Dianna Jordan, Secretary
Julie Delaney, Treasurer
Steve Putney, Director
Karen Dunn, Director
Tom Petersen, Director