OMAHA, NEBRASKA, Oct. 3, 2016 — Green Plains Inc. (NASDAQ:GPRE) today announced that it has acquired SCI Ingredients Holdings, Inc. (SCI) and its wholly owned operating subsidiary Fleischmann’s Vinegar Company, Inc., the world’s largest manufacturer and marketer of food-grade industrial vinegar for $250 million, subject to certain post-closing adjustments. Green Plains entered into a definitive stock purchase agreement with the selling shareholders of SCI and is financing the transaction with $135 million of debt with the balance paid from cash on hand. A group of lenders led by Maranon Capital, L.P. provided a $130 million term loan and a $15 million revolving line of credit for this business unit.
“This strategic acquisition of Fleischmann’s Vinegar Company brings a new adjacent business that adds a consistent, growing earnings stream and expands our focus on the food and feed ingredients industry,” said Todd Becker, president and chief executive officer of Green Plains. “Our long term strategy is centered around growing our company to take advantage of the rising global demand for energy and food products. The Fleischmann’s Vinegar portfolio of products is well positioned beyond food ingredients, ranging from antimicrobials, animal feeds, herbicides and disinfectants to name a few.”
“As we approach scale as one of the largest ethanol producers in the world, we have the engine of a significant commodity-processing entity that can generate substantial cash flow, allowing us to enhance the food and feed ingredients side of our business,” added Becker. “The Fleischmann’s Vinegar acquisition will lead to further supply chain opportunities within Green Plains, as its largest production cost is food-grade ethanol. We will use our commodity and risk management expertise to expand our opportunities into consumer and industrial-based ethanol products.”
Fleischmann’s Vinegar is an all-natural specialty ingredients company serving a range of markets and end-use applications, including: food and beverage ingredients, antimicrobials, bio-herbicides and cleaning products across the food, beverage, agricultural, industrial and wholesale markets. Fleischmann’s Vinegar offers a broad portfolio of products that serve to embed the company as a critical component of its customers’ end products. Fleischmann’s Vinegar is the world’s largest manufacturer and marketer of food-grade industrial vinegar. Headquartered in Cerritos, California, the company has 112 employees and operates seven manufacturing facilities located in Alabama, California, Illinois, Maryland, Missouri, New York and Washington. The company also utilizes four distribution warehouses located in Oregon, California, Texas and Quebec, Canada.
“I am pleased to welcome Ken Simril, president and CEO of Fleischmann’s Vinegar Company, the management group and all of the employees to the Green Plains team,” continued Becker. “Under Ken’s leadership, Fleischmann’s Vinegar has achieved incredible innovation and growth over the last 10 years, focused on adapting its production capabilities to current on-trend consumer needs such as organic, non-GMO, beverages and varietals. Ken will lead our overall global food ingredient growth strategy as we continue to develop areas adjacent to our supply chain. The current management team will continue operating Fleischmann’s Vinegar as a standalone business, utilizing their many years of industry and management experience.”
XMS Capital Partners acted as financial advisor and Husch Blackwell LLP acted as legal advisor to Green Plains Inc. BMO Capital Markets acted as financial advisor and Goodwin Procter LLP acted as legal advisor to Stone Canyon Industries, LLC and the selling shareholders of SCI.
About Green Plains
Green Plains Inc. (NASDAQ:GPRE) is a diversified commodity-processing business with operations related to ethanol, distillers grains and corn oil production; grain handling and storage; a cattle feedlot; and commodity marketing and distribution services. The company is the second largest consolidated owner of ethanol production facilities in the world, with 17 dry mill plants, producing nearly 1.5 billion gallons of ethanol at full capacity. Green Plains, through its wholly owned subsidiary Fleischmann’s Vinegar Company, provides specialized ingredient solutions for leading food and feed manufacturers. Green Plains owns a 62.5% limited partner interest and a 2.0% general partner interest in Green Plains Partners LP (NASDAQ:GPP), a fee-based Delaware limited partnership that provides fuel storage and transportation services by owning, operating, developing and acquiring ethanol and fuel storage tanks, terminals, transportation assets and other related assets and businesses.
About XMS Capital Partners
XMS Capital Partners, a boutique investment bank with offices in Chicago, London and Dublin, was founded in 2006 on the belief that clients value senior banker involvement from a trusted advisor in all aspects of an engagement.
We practice Involvement BankingTM, which means going beyond transaction-focused investment banking: we are client centric, not product driven, and our solutions are tailored, innovative and supported by rigorous analytics.
XMS has a core expertise in complex strategic and financial transactions and our clients know us for our thoughtful judgment, in-depth collaboration and creative solutions.
Our partners average over 25 years of investment banking experience and have led hundreds of billions of dollars of global transactions.