More asset sales of Agriliance LLC are expected soon, according to the company’s two owners, CHS Inc. and Land O’Lakes Inc. The two partners are working to reposition remaining Agriliance retail assets, and expect that a majority of those assets will be sold through a number of transactions by first quarter 2010.
CHS told Green Markets that there is an acquisition pending involving remaining Agriliance retail locations that the company thinks will close in the coming weeks, but there were no further details.
There was industry speculation last week that Agrium Inc. or its Crop Production Services retail unit might be a contender for some of the remaining retail locations of Agriliance. Although Agrium had no comment, the company, which is the largest ag retailer in the country, is still in the market to buy additional retail outlets.
Once this pending sale is complete, CHS said the last major asset remaining is the Memphis-based ProSource One, which distributes products to the professional turf, ornamental, nursery, aquatics, and vegetative pest management businesses.
LOL would not disclose transaction details, but indicated that on an aggregate basis the transactions should generate $100 million in cash receipts by the end of the first quarter of 2010, net the cost of the acquired properties plus associated working capital. LOL said $25 million of this cash was received through a dividend distribution from Agriliance during the third quarter ending Sept. 30, 2009.
In July 2009, both CHS and LOL announced the acquisition of selected Agriliance locations into their respective company operations (GM Aug. 10, 2009). CHS took eight operating units in northern Texas locations into its Country Operations business. Winfield Solutions, an LOL company, acquired 40 locations in Arkansas, Mississippi, and Louisiana. Also in July, Tennessee Farmers Cooperative purchased 11 Agriliance retail locations in Tennessee, Kentucky, Arkansas, and Missouri. Previously, CHS and LOL divided larger chunks of Agriliance, with crop nutrients going to CHS and crop protection to LOL (GM Sept. 10, 2007).