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Non-Tech : Imperial Sugar (IPSU)
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To: Patentlawmeister who wrote (27)12/6/2002 9:33:35 AM
From: Crossy  Read Replies (1) of 121
 
Cudawuda & all,
found an old article (1997) mentioning the interest of sugar-grower cooperatives in Imperial Sugar's milling plants. Well, 3 cooperatives were cited: Michigan, Wyoming & Montana and California. The first two deals already closed. The last one may still come up. There's a fine difference this time: it seems as IPSU won't need the money. From my calculations their long term debt has been wiped out by now. This means, Imperial might be able to negotiate a better price. The cooperatives like this because they can manage supply and secure processing capacity better this way. This also provides them access to cheapo "industrial bonds" backed by Uncle Sam. Don't know how much the California plants could yield but maybe > $30m could be in shore.. (my judgement only)

Finally I did some historic DD on an acquisition IPSU did before it declared bankruptcy - it was called Imperial Holly back then, ticker: AMEX:IHK. Well, they acquired Savannah Foods back then, for $700m. That firm had the Michigan Sugar milling operations (sold to cooperative recently), King Packacing and a 2 rather big foodservice divisions: a "sweet" one and Diamond Crystal Brands. Well, Hormel bought DCB now for $115m. The cooperative bought Michigan Sugar for around $50m. Another foodservice part was bought by hormal after emergence of BK. Then King Packaging was sold for $25m. Means that more than $200m were realized for Savannah Food Components. But the SUGAR FOODSERVICE DIVISION of Savannah (plus some formerly DCB-owned sugar related brands) were retained. That is where I think the future "core" of IPSU's business model will be placed. And this market is nicely growing - that's what I hear - and it has good margins.

IPSU can then decide whether to shed beet or cane growing operations or shed all of them. I think they will do this if the price is right.. Good for the company. Survival no longer in question.. But a good future with decent sales..

rgrds
CROSSY
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