- By Lynda Kiernan-Stone, Global AgInvesting Media
Perdue AgriBusiness Expands Organic, Non-GMO Oilseed Business with Deal for Hart AgStrong Assets
Perdue AgriBusiness announced it has acquired the assets of Hart AgStrong. The financial details of the deal were not disclosed.
As an independent operating company of Perdue Farms, Perdue AgriBusiness is one of the largest grain companies in the U.S., and Perdue AgriBusiness Specialty Crops and Oils is a world leader in the procurement and sale of verified organic and non-GMO grain and oilseeds on both the U.S. and international markets.
Under the terms of the deal, included in the acquisition, are two oilseed expeller crush facilities in Bowersville, Georgia, and Trenton, Kentucky, that process organic and non-GMO soybeans, high erucic acid rapeseed (HEAR), canola, and high oleic sunflower. The Bowersville site also includes an organic specialty oil refinery. Together the sites produce organic and non-GMO oils that are sold to manufacturers in the food and industrial industries, and meal for organic and non-GMO animal feed operations in the southeast region of the U.S.
These assets will be integrated into the existing Perdue AgriBusiness Specialty Crops and Oils business. And even though Perdue is the largest supplier of organic feed ingredients in the U.S, this deal will give the company its first dedicated organic and specialty oil refinery with added oilseed crushing capabilities, Perry Aulie, senior vice president of value-added for Perdue AgriBusiness, told Feed Navigator.
“The AgStrong facilities offer an ideal complement to Perdue AgriBusiness’ existing Specialty Crops and Oils capabilities,” said Dick Willey, president of Perdue AgriBusiness. “We will be able to increase sales of our current and new specialty oils. AgStrong’s production capabilities coupled with Perdue AgriBusiness’ brand equity allows us to offer a vertically integrated supply chain with full traceability to our customers.”
Canola and a Court Case
This asset sale follows a very challenging year for Hart AgStrong. Last year, investment company RPP Investments filed a suit in Gwinnett County, Georgia, against Hart AgStrong Secretary of State Brian Kemp, who was a shareholder in the company, and company co-founder and CEO Robert Davis.
Upon needing a loan of $500,000, RLP Investments made their second loan to Hart AgStrong, which put up thousands of bushels of canola and sunflower seeds as collateral. The first loan issued by RLP Investments was repaid, however, Hart AgStrong defaulted on the second $500,000.
Complicating matters, it was reported that the canola and sunflower seeds used to secure the loan were not owned by AgStrong. AJC reports that after fires at two of its plants, AgStrong misdirected the insurance payouts, and did not compensate the farmers who lost their grain.
Following these actions the company was not allowed to accept grain from farmers without an upfront payment, seriously reducing its inventory, as it was still attempting to repay its farmers.
Now in the hands of Perdue, production at the facilities has increased once again, and all Hart AgStrong employees have the option to shift their employment to Perdue.
“We were purchasing this oil from someone else in the past - now that we are doing it ourselves, we have an economic advantage of taking out the third party,” Aulie told Feed Navigator. “Secondly, from a traceability standpoint, we’re now able to control that traceable product that we know where it originated and how it was treated before it gets to our facility.”