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BAY CITY, Mich. (AP) -- Sugar beet growers under contract with
Michigan Sugar Co. are considering whether to buy the company from
its Texas-based owner, a newspaper reported Monday. In January,
Imperial Sugar of Sugar Land, Texas, proposed a grower buyout of
Michigan Sugar to the executive committee of the Great Lakes Sugar
Beet Growers Association, the Bay City Times reported.
"We have formed a steering committee to examine the
possibility of forming a co-op, and that committee is currently
working to gather information about Michigan Sugar and Imperial
Sugar," said Richard Leach, who represents Michigan Sugar's
1,400 growers in the so-called "Thumb" area of central and
southeastern Michigan and Ontario.
Roy Cordes, corporate secretary and deputy general counsel for
Imperial Sugar, confirmed the company would only sell to a grower
co-op right now. Leach said a decision could take some time.
"Growers have no reaction to this proposal yet. They have
seen no buyout numbers and no time frame has been set," Leach
said. "When you make this big of a decision, you want to make
sure that everything is right."
Imperial refines raw cane sugar at four plants in Florida,
Georgia, Louisiana and Texas and produces beet sugar at 11 plants in
California, Michigan, Missouri and Wyoming. The sugar beet business
carries risks related to depressed markets, grower contracts and
unpredictable weather patterns -- factors that Imperial Sugar would
like growers to be responsible for, Leach said. Cordes said Imperial
isn't looking to get out of the sugar beet business, but is
considering selling Michigan Sugar to a grower co-op because of
mutual interest.
Imperial purchased Michigan Sugar three years ago from Savannah
Foods and Industries Inc., of Savannah, Ga. Since then, the company
has watched its stock price plummet from a high of $16 per share in
1997 to slightly more than $1 per share now.
The company has assets totaling more than $1.2 billion and
reported net sales, for the six months ended March 31, 2000, of more
than $8.9 million, down from more than $9 million for the same
period in 1999. It was unclear what would happen if Michigan growers
decide not to purchase Michigan Sugar, Leach said.
"They have given us no time frame in which we must make a
decision," he said. "Whatever happens, we will see
changes. What those changes are, we don't know."
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