The Andersons, Inc. (Nasdaq: ANDE) has announced a merger agreement with Lansing Trade Group, LLC, its long-time affiliate, to acquire the 67.5 percent of Lansing equity that it does not already own for cash and stock currently valued at a total of approximately $305 million.
In addition to paying approximately $175 million in cash, the Company will issue unregistered shares to current Lansing equity holders presently valued at approximately $130 million, subject to certain closing adjustments and changes in the share price of Andersons stock, respectively.
Founded in Lansing, Michigan, in 1922, Lansing Trade Group is focused on the movement of physical commodities including grains, feed ingredients, energy products, and freight within North America and internationally.
Presently based in Overland Park, Kansas, it employs approximately 550 associates in more than 20 facilities across the U.S. and Canada and a dozen other offices, including London and Singapore. It owns approximately 55 million bushels of grain storage space and traded more than 1 billion bushels of grain in 2017.
The transaction is expected to close before January 31, 2019, subject to Lansing shareholder approval and customary government and regulatory approvals. Lansing will be integrated with The Andersons' Grain Group, and the combined operation will be jointly led by Corey Jorgenson, President of The Andersons Grain Group, and Bill Krueger, President and CEO of Lansing Trade Group.
"This acquisition creates a grain business of highly complementary assets with greater scale that significantly expands our reach in the agricultural marketplace," said Pat Bowe, President and CEO of The Andersons. "We firmly believe the union of these core agricultural businesses will allow us to compete more successfully, provide greater value across an expanded platform, and grow more profitably.
"Combining our talented teams is a very compelling opportunity to unlock potential by bringing together the best of each business. We will be able to provide Freedom pricing tools to the current Lansing producers while leveraging The Andersons' facilities to merchandise more bushels to enhance our ability to supply our consumptive demand base. In effect we will be developing a more robust North American supply chain," commented Bill Krueger, President and CEO of Lansing Trade Group.
"The full integration of Lansing will accelerate execution of our strategic intention to grow income from originations and managing grain assets, expand trading and risk management services, and broaden our food ingredients and specialty grains and feed ingredients platform," said Corey Jorgenson, President of The Andersons Grain Group.
Founded in Maumee, Ohio, in 1947, The Andersons conducts business across North America in the grain, ethanol, plant nutrient, and rail sectors. According to the company website they own grain terminals in eight states including Ohio, Michigan, Indiana, Illinois, Iowa, Nebraska, Tennessee and Texas with grain storage capacity of more than 143 million bushels at 35 grain storage facilities.