Legumex Walker Announces Sale of Special Crops Division to The Scoular Company
November 14, 2015
WINNIPEG, MB (September 14, 2015) – Legumex Walker Inc. (TSX: LWP) (“LWI” or the “Company”) today announced that it has entered into a definitive agreement (“the Agreement”) with The Scoular Company (“Scoular”) pursuant to which Scoular has agreed to acquire substantially all of the assets of LWI’s Special Crops Division for CAD$94 million plus the amount of net working capital at closing, on a cash free debt free basis, paid in cash. The sale represents a CAD$174.6 million transaction value for LWI, based on LWI’s working capital as at June 30, 2015. The actual purchase price and transaction value are subject to working capital and other adjustments in accordance with the Agreement (all figures are in Canadian dollars).
Scoular is a leading U.S.-based agricultural marketing company that manages supply chain risk for global suppliers and end-users of grains, oilseeds, and other feed and food ingredients.
As announced previously, the Special Committee of the Board of LWI (the “Special Committee”) oversaw an extensive process starting in March 2015 (the “Strategic Review”) and considered a number of alternatives to maximize shareholder value. As a result of the Strategic Review, and in light of the challenges facing the Company, the Special Committee unanimously determined that a sale of the Special Crops Division was most likely to maximize shareholder value.
“Following careful review of the transaction by the Special Committee in consultation with our external financial and legal advisors, we believe this transaction represents excellent value and is in the best interests of LWI shareholders,” said Bruce Scherr, Chairman of the Board of Directors of Legumex Walker Inc.
“This is a highly strategic addition to our existing global feed and food ingredient merchandising business and U.S.-based grain-handling network,” said Bob Ludington, Scoular’s Chief Operating Officer. “The transaction will significantly increase our product and geographic footprint, which in turn will increase our ability to serve new and existing customers worldwide. We expect to operate Scoular Special Crops much like LWI operates the business today, but with the financial capacity to expand operations, product lines, and distribution channels. As a result, we will be able to provide additional value to Canadian producers and pursue opportunities to serve a global customer base seeking specialty products associated with healthy food trends.”
“The goal for our Special Crops Division was to bring together several exceptional businesses in our industry, diversify across our product offerings, growing regions and customers, and create an exceptional platform that would thrive as it grew,” said Joel Horn, President and Chief Executive Officer, Legumex Walker Inc. “Coming off a record year for Special Crops, we are proud that an organization of the caliber of Scoular recognizes the value that we have created.”
A 123-year old company with nearly $6 billion in sales, Scoular operates 130 independent business units that provide diverse supply chain solutions for end-users and suppliers of grain, feed ingredients, and food ingredients around the globe. From more than 90 offices and facilities, more than 850 employees are engaged in the business of buying, selling, storing, and handling grain and ingredients as well as managing transportation and logistics worldwide. For further information, visit www.scoular.com.
About Legumex Walker Inc.
LWI is a growth-oriented processor and merchandiser of pulses and other special crops, and through the Company’s PCC canola seed processing facility in Washington State, canola products. The Company derives its revenue from sourcing, processing, marketing and distributing special crops, canola products and associated healthy, specialty food ingredients to a global customer base. The Company operates processing facilities in the Canadian Prairies, American Midwest, the Pacific Northwest, and China. LWI has an 84 percent interest in PCC, a canola oilseed processing facility in the State of Washington, the largest commercial-scale canola oilseed processing facility west of the Rocky Mountains.
For additional information, please contact:
Manager, Investor Relations – Legumex Walker
For inquiries specifically related to Scoular, please contact:
Julie Heiliger, Director, Brand Marketing & Corporate Communications
The Scoular Company