Growmark Inc. and Bunge North America, the North American operating arm of Bunge Ltd., announced on Jan. 20 that they have created B-G Fertilizer LLC to acquire a liquid and dry fertilizer storage terminal currently owned by CF Industries Holdings Inc. in Cincinnati, Ohio.
B-G Fertilizer LLC will use the facility, which has approximately 91,000 tons of dry and liquid storage capacity, to supply crop nutrients to retail fertilizer dealers. The two companies said the partnership will allow both to tap existing expertise within their organizations while also leveraging Bunge’s grain and oilseed network in Indiana, Ohio, and Kentucky.
The transaction is expected to close in the first quarter of 2011 and is subject to completion of due diligence activities and other customary conditions. Terms of the deal were not disclosed.
“We are excited about the possibilities the partnership with Bunge North America brings to the retailer community served from Cincinnati,” said Jim Spradlin, Growmark vice president, Agronomy. “Bunge has strong risk management experience as well as extensive blending and distribution experience in the Americas that when combined with Growmark’s domestic sourcing, sales, and risk management expertise will provide important synergies to both organizations.”
“The Bunge-Growmark partnership supports our corporate objective of pursuing beneficial acquisitions and business alliances,” said Rod Wells, Growmark director, Agronomy sales and operations.
“Bunge is pleased to be working with Growmark to provide value to customers through access to an efficient supply chain,” said Matt Thibodeaux, general manager, Bunge Fertilizer. “Together Bunge and Growmark can access ingredients from both international and domestic fertilizer production sources, ensuring the success of the Cincinnati facility.”
The transaction is the second involving CF and Growmark in as many weeks. On Jan. 6, CF announced that it had entered into a definitive agreement to sell four mainly dry product warehouses and related assets to Growmark and one of its subsidiaries (GM Jan. 10, p. 1). Those facilities are located in Albany and Mapleton, Ill., Cincinnati, Ohio, and St. Louis, Mo., and will be used by Growmark and its subsidiary to serve the needs of the organization’s retail customers that provide fertilizer to farmers. That deal was expected to close in January.
Storage capacities in the Jan. 6 transaction include 36,500 st in Albany, all dry; 61,000 st in Mapleton, all dry; and 39,000 st in St. Louis (Bussen spur), all dry. The Cincinnati terminal has 60,000 st of dry and 30,000 st of liquid capacity. Overall, Growmark said the Jan. 6 acquisition represents approximately 226,000 tons of dry and liquid plant food storage.
Growmark announced Jan. 7 that it had entered into an agreement with George Lamb whereby Growmark will acquire Lamb’s Seneca Terminal at Seneca, Ill. (GM Jan. 7, p. 10). That acquisition includes 45,000 st of dry fertilizer storage, dock, and acreage. Growmark plans to add liquid nitrogen storage at the site.