| After four months of studies and preliminary negotiations,
the Rocky Mountain Sugar Growers Cooperative has authorized a new letter
of intent to purchase Western Sugar from its parent company, Tate &
Lyle North American Sugars.
During a conference call Wednesday evening, the board of directors
discussed the latest information with cooperative attorney Randon Wilson.
From his Salt Lake City office Wednesday afternoon, Wilson said the
negotiations are in a critical stage.
"We had an excellent meeting last week," Wilson said.
"Things are going well, and we're getting very close." Wilson
said he hopes to have some final decision by Monday. He will then send
letters to growers to update them on the purchase efforts.
Kevin Hall, cooperative board vice president from Bridgeport, said he
is eager to see how the negotiations turn out. Hall said he hasn't heard
anything negative about the possible purchase.
"People are cautiously optimistic," he said. "They just
want to make sure if it is bought, it will pay for itself."
The move to purchase the company began earlier this year when Tate
& Lyle announced it would consider selling the company because
stockholders were not satisfied with returns on their investment in the
sugar processing facilities over the past 15 years.
In July, the cooperative, consisting of 10 representatives from the
four Western Sugar producer states of Colorado, Nebraska, Montana and
Wyoming, was formed to explore purchasing the company. Its board of
directors consists of Rick Dorn, Hardin, Mont., president; Kevin Hall,
Bridgeport, vice president; Bob Martens, Lovell, Wyo.,
secretary/treasurer; members, Robert Busch, Mitchell; Joe Amen and Mike
Vasa, Colorado; Edwin Kuntz and Roger Nedens, Montana; and Ric Rodriguez,
Wyoming.
The grower cooperative requested $2 per planted acre for the 2000 crop
from producers that would be used to fund a feasibility study. The study
would explore the purchase of Western Sugar from Tate & Lyle. Six
facilities in four states, would be included. The growers could also
expect to pay $200 per acre toward the purchase price, with the balance
coming from outside financing.
There is a potential for 185,000 acres of sugarbeets among the four
states. Nebraska accounts for 73,000. The Scottsbluff facility employs 230
full-time people and an additional 250 during campaign. The Bayard
facility has a permanent payroll of 53, and hires 166 seasonal employees
during campaign. There are 550 growers and approximately 73,000 acres in
the Scottsbluff district. This includes 400 to 450 growers with
approximately 54,500 acres in 13 Nebraska Panhandle counties. The
remainder are located at Big Springs, Nebraska, and in the northeastern
corner of Colorado. Those 18,500 acres can be shipped to the
Sterling, Colo., factory or to Scottsbluff or Bayard.
According to Western Sugar figures, the company generates $43 million
of economic activity locally. This includes payroll, unemployment
compensation, workers compensation, local purchases such as coal, lime
rock gasoline, daily purchases, and grower payments. The Bayard facility
generates $28 million in the local economy. |