All Posts from January 17, 2017

Parrish & Heimbecker buys CPS facilities in Alberta

Canadian agribusiness Parrish & Heimbecker Ltd. (P&H) announced on Jan. 16 that it has entered into an agreement to purchase four Crop Production Services (Canada) Inc. locations in Alberta. The retail facilities are in Sedgewick, Wainwright, St. Paul, and Marwayne, and will expand Parrish and Heimbecker’s presence in north-central Alberta.

“P&H has been aggressively expanding its footprint on the crop input business across Canada with several new fertilizer plants, chemical sheds, and seed facilities at our grain terminal locations,” said Justin Watson, P&H national director of crop nutrients. “Expansion into this geography and working with the experienced staff at these four new locations will be a great opportunity. We look forward to meeting the needs of customers in this area.”

The transaction, which is expected to close on Feb. 2, 2017, is the latest in a series of recent efforts by P&H to expand its fertilizer business in Canada. The company reported in late 2016 that it had opened new fertilizer blending plants at Wilson Siding, Alba., Gladstone, Man., and Biggar, Sask., and was working to expand fertilizer storage capacity at existing Saskatchewan crop input and grain terminal locations in Moosomin, Tisdale, and Moose Jaw (GM Dec. 2, 2016).

“Sedgewick, Wainwright, St. Paul, and Marwayne have strong staff who are dedicated to serving their customers,” said Watson. “We look forward to welcoming them into the P&H family. P&H is proud to offer services into North/Central Alberta.”

Headquartered in Winnipeg, Man., P&H is a family-owned operation with more than 40 locations and over 1,500 employees across Canada. In addition to crop input products and services, the company has an extensive grain elevator network and also operates trading and merchandising, transportation and logistics, feed, and grain milling businesses.

Israeli official proposes open tender for Dead Sea mining rights

Israel’s Finance Ministry Accountant General Michal Abadi Boiangiu has recommended an open tender for mining rights at the Dead Sea when the license of Israel Chemicals Ltd. expires in 2030. She presented her recommendations Jan. 17 to the senior officials at the ministry regarding the issue of mining rights at the Dead Sea.

The recommendations run counter to the attempts by the ministry in the past few years to reach an agreement with ICL over extension of the rights beyond 2030 in exchange for the acceptance of certain changes and concessions in a new agreement with the Israeli government. The recommendations made public today sent shares of ICL down sharply on the Tel Aviv Stock Exchange.

Abadi Boiangiu completed her report just weeks before she steps down from her position and is due to be replaced by Roni Hezkiyahu. The report contains an assessment of the value of the assets held by ICL that the Israeli government would presumably have to pay for in the event of an open tender. ICL has held up further investment at the Dead Sea pending an outcome of the issue of extending the license for mining potash and other raw materials.

The Andersons to exit retail business

The Andersons Inc. have announced plans to exit the retail business and close its remaining four retail stores in the second quarter of 2017. It said the retail closings will have no impact on the company’s grain, ethanol, plant nutrient and rail operations.

“The decision to close The Andersons stores was not easy for anyone involved,” says CEO Pat Bowe. “Choosing to cease a business that has spanned 65 years and employs about 1,050 people is tremendously difficult.”

The closing will eliminate approximately 650 positions in the Toledo area and 400 positions in Columbus, of which approximately 75 percent are part-time positions. The company will provide employees with severance packages and outplacement services to assist them in their career transitioning.

During the past eight years the Retail Group has incurred pre-tax losses, including previous asset impairments, in excess of $20 million and closed three stores.

The full financial impact of this closure has not been determined. The company expects to record pre-tax impairment charges on long-lived assets related to the Retail segment of approximately $6.5 million in the fourth quarter of 2016.

The company expects to record a pre-tax charge in the range of $9 to $14 million in the first half of 2017 for severance costs and other costs associated with the closure. The company also anticipates that the full carrying value of its inventory may not be recoverable during the store liquidation process. Gains or losses are anticipated on individual properties upon sale, however the company is uncertain of the timing and amount of those sales.

Subsequent to the impairment charges noted above, the Retail Group’s assets at their December 31, 2016 carrying values include: Inventory and other assets at $21 million; long-lived assets at $9.8 million.