FCSA Nixes Rabobank Deal

Farm Credit Services of America has terminated its merger agreement with Rabobank, a $500 billion Dutch lending cooperative, citing outside opposition and possible regulatory delays in completing the deal.Rabobank originally offered $600 million to acquire and privatize FCSA, which is part of the Farm Credit System. As the groundbreaking deal became more controversial, Rabobank increased the purchase price by $150 million. "We believe FCSAmerica's board may have been subject to undue pressure by certain Farm Credit System institutions and other third parties," the Dutch cooperative bank said. FCSA, which is based in Omaha, Neb., said several factors influenced the board's decision to terminate the merger agreement and remain a lending association within the Farm Credit System. As part of the transaction, FCSA would have paid the Farm Credit System an $800 million exit fee to end its association with the government-sponsored enterprise.