Legumex Walker Officially Lists Oilseed Processing Assets for Sale
Legumex Walker has officially listed its oilseed and specialty crop processing plants located in the U.S. Midwest, the Pacific Northwest, the Canadian Prairies, and China for sale. The decision has been made after the group’s canola processing segment posted adjusted earnings before income, tax, depreciation and amortization (EBITDA) of negative $3.6 million for the first half of 2015 and a lending group led by AgCountry Farm Credit Services recently demanded repayment of a US$54.6 million loan by the end of July.
The specialty crops segment consists of three divisions:
The sunflower, flax and bird seed unit has processing plants in Winnipeg, Winkler, Manitoba, St. Jean Baptiste, Manitoba, and Mentor, Minnesota, with a processing capacity of 141,000 tons per year.
The edible bean division has processing plants in Morden, Manitoba and Plum Coulee, Manitoba, St. Hilaire, Minnesota, and Tianjin, and Dalian, China with processing capacity of 106,000 tons per year.
The pea, lentil, and canaryseed division has processing plants in Runciman, Brooksyby, Saskatoon, and Regina in Saskatchewan and a plant in St. Jean Baptiste, Manitoba with an annual processing capacity of 275,000 tons.
Some industry analysts don’t believe that there will be much initial interest in purchasing the group’s canola crushing facility in Warden, Washington, due to its distance from most major canola growing regions, however, there is expected to be a high level of competition to acquire the specialty crops unit among perspective buyers including Canadian grain companies and processors looking to expand, and by foreign buyers seeking access to Canadian origination.
Other analysts however, are expressing doubts about the quick sale of the assets, stating that the main processing facilities are located in northern Saskatchewan where acreage has been declining and rail charges have been increasing, adding that any company seeking to expand will likely look to build facilities themselves.