Canadian feed manufacturer Ridley Inc. is buying Wayne Feeds, the animal nutrition division of ContiGroup Companies, formerly Continental Grain, for about $37 million (U.S.) in cash.
The final price depends on working capital valuation issues and will be determined at closing, a company news release said.
The company hopes to close the deal by March 31.
“Wayne Feeds is among the 10 largest commercial feed manufacturers in the United States, with production capacity of about one million tons,” said Ed Moloney, president and chief executive officer.
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“Acquiring Wayne Feeds significantly expands our presence in the U.S. Midwest and marks our entry into new markets in Pennsylvania, Kentucky, Wisconsin and North Carolina. It is highly complementary with our Hubbard Feeds operations in the U.S.”
The Wayne operations will be integrated with Hubbard’s. This will include administration, sales and Wayne’s 12 production plants with Hubbard’s 14 dry feed facilities, leading to substantial operating efficiencies and cost reductions.
Net earnings in the second quarter amounted to $1 million, compared with $8.2 million in the same quarter in 1999.
That result included a foreign exchange gain of $5.4 million resulting from the capital restructuring of Ridley’s U.S. business. Excluding that, net earnings for the period were $2.9 million.
