The Andersons, Inc. (ANDE) in association with Lansing Trade Group, LLC, has entered into an agreement to acquire Thompsons Limited. Subject to customary closing conditions, the acquisition is expected to close at the beginning of the third quarter. Both the companies will equally own the business.
Headquartered in Blenheim, Ontario, Thompsons Limited is an integrated grain and food-grade bean handler and agronomy input provider. Even after the acquisition, it will continue to operate as Thompsons Limited, while Lansing Trade Group's current office in Chatham, Ontario, will be consolidated into Thompsons.
Thompsons Limited will benefit from the combined strength of Lansing and The Andersons in its other areas of business including grains, food-grade products and farm services. The acquisition will provide Lansing Trade Group an opportunity to grow its existing Canadian business which is in line with its long-term strategy. It will also assist immediate growth in the crop nutrients sector of Lansing.
Andersons, however, will secure its position in Ontario through this acquisition. It will also help Andersons in long-term growth as Thompsons, having a similar strategy, is keen on cultivating and maintaining long-lasting relationships with growers and end users globally.
Maumee, Ohio-based Andersons, which belongs to the agricultural and farm products industry along with Cosan Ltd. (CZZ), Archer Daniels Midland Co (ADM) and Bunge Ltd (BG), reported revenues of $112 million in its Plant Nutrient Group in first-quarter 2013, down 36% from the year-ago quarter, led by a significant decrease in volume. Moreover, delays in fieldwork and adverse weather condition contributed to the decline.
The recently acquired assets from Green Plains Grain Company and Mt. Pulaski Products will boost Andersons’ top and bottom lines. The Plant Nutrient Group should also benefit from an anticipated record corn crop planting in the second quarter, if the weather permits. However, the U.S drought will likely continue to negatively impact the grain and ethanol businesses in 2013.
Andersons currently retains a short-term Zacks Rank #3 (Hold).
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