NASDAQ-traded agribusiness The Andersons has merged with its affiliate Lansing Trade Group after acquiring the 67.5 percent of the business it did not already own for about $305 million in cash and stock.
The Andersons plans to issue $130 million in unregistered shares to Lansing’s existing equity holders, with the remainder of the purchase price paid in cash.The Ohio-headquartered company will also assume $166 million of Lansing’s debt as part of the deal, which the parties said was equivalent to just under 9x Lansing’s annual EBITDA through the end of August.
In addition to The Andersons’ existing stake, other investors in the company have included Australia’s Macquarie and Chinese private equity firm New Hope Group, which purchased a 20 percent stake in the business for $127.5 million in 2015.
Headquartered in Overland Park, Kansas, Lansing provides physical movement of commodities including grains, feed ingredients, energy products and freight. It owns more than 55 million bushels of grain storage at 20 facilities across the US and Canada and 12 facilities in international markets including London and Singapore.
In June 2017, Lansing acquired the grain and feed ingredient trading business of Troy, New York-headquartered Interstate Commodities for an undisclosed sum.
Pat Bowe, president and chief executive of The Andersons, said that the planned combination of Lansing with the company’s existing grain unit will position it to “expand our reach in the agricultural marketplace.”
On a conference call Tuesday, Lansing president and chief executive Bill Krueger described the company’s grain and feed ingredient mechanizing platform, largely concentrated on the West Coast, as complimentary to The Andersons’ existing, mostly East Coast-focused assets. Lansing’s pet food, specialty grains and dried distiller’s grains businesses are among those that will be integrated into The Andersons, he said.
Bowe said that while 2015 and 2016 were tough years for the grain business, The Andersons expects to find opportunities in grain markets, including through the benefits of volatility the company expects.