MOORHEAD, MINN. - September 24, 2002 - American Crystal Sugar Company, Imperial Sugar Company and Western Sugar Cooperative announced today that they are currently in the due diligence phase of a three-way sugarbeet factory agreement. The transaction involves the Sidney, Montana, Torrington, Wyoming and Hereford, Texas factories.
The transaction contemplates that American Crystal will purchase the Sidney, Torrington and Hereford factories from Imperial. Western will simultaneously enter into a long-term lease arrangement with American Crystal to operate the Torrington factory. American Crystal plans to continue operations at the Sidney factory and leave the Hereford factory idle. Hereford hasn't processed sugarbeets since 1998. The entire transaction is expected to close in October of this year.
The arrangement contains attractive business aspects for each organization as well as all sugarbeet growers affected by this transaction.
"Selling our sugarbeet production assets in the Midwest is consistent with our long-term objectives, including our desire to focus on strategic locations and reduce the Company's leverage," said Imperial Sugar Company President and CEO Robert Peiser. "We expect the impact on our customers to be minimal as we remain committed to serving them throughout the country from our cane refineries and California beet facilities."
"Acquiring the Torrington factory, which is located in one of our core production areas, is a solid tactical and operational fit for Western Sugar and supports the long-term interests of our shareholders," commented Inder Mathur, President and CEO of Western Sugar. Mathur added, "We are also looking forward to working with the Torrington growers in developing a long lasting and successful relationship."
"The strategic thrust of this investment will allow American Crystal to operate more effectively under the marketing environment of the 2002 Farm Bill," said Jim Horvath, American Crystal President and CEO. "The additional acreage and processing capacity created by operating the Sidney location will add value to American Crystal customers, shareholders and the Sidney community alike. We look forward to making the Sidney growers and employees part of the American Crystal family."
American Crystal Sugar Company is owned by approximately 3,000 members in the Red River Valley (Northwestern Minnesota and eastern North Dakota) and is the largest beet sugar producer in the U.S. Imperial Sugar Company is the largest processor and marketer of refined sugar in the United States and a major distributor to the foodservice market. Western Sugar Cooperative is a grower owned processor with more than 1,000 members in Colorado, Montana, Nebraska and Wyoming.