Milling & Baking News - November 4, 2008 - 10

Business

ConAgra Mills agrees to supply flour
to MGP Ingredients; mill to close
ATCHISON, KAS. - MGP Ingredients Inc. and ConAgra Mills Inc. on
Oct. 20 signed a non-binding letter of
intent under which ConAgra would
supply MGPI with wheat flour to be
used for the production of protein
and starch ingredients.
Tim Newkirk, president and chief executive officer of MGP Ingredients, said
the supply agreement could become
effective within a month, pending the
outcome of further negotiations.
In connection with the agreement,
MGPI has halted production at its Atchison flour mill, effective immediately.
"Unfortunately, this situation necessitates an adjustment in our workforce
numbers," Mr. Newkirk said. "This
adjustment involves temporary layoffs
affecting 32 positions. Simultaneously,
we are offering early retirements to an
additional 12 employees."
Mr. Newkirk described the decision
to close the mill as "difficult and painful" from a personnel standpoint.
"However, it is a (decision) we find
necessary for the good of the business
and our overall workforce as well as in

during our 2008 fiscal year. Very simply
put, wheat milling as a component of
our overall ingredient solutions value
chain is not a step in which MGPI can
the best interest of our stockholders," uniquely create value. As such, we are
he said. "This potential change will also exploring alternative methods for obenable us to more effectively serve our taining the raw material for our ingredient solutions products."
customers by concentrating
MGPI acquired the
on those areas of our opAtchison mill in 1987, after
erations that can generate
exploring a range of opgreater value for them."
tions, to counter difficulties
With 20,000 cwts of daily
the company had experimilling capacity, the Atchison mill of MGP Ingredi- CREATING BETTER SOLUTIONS...NATURALLY enced purchasing enough
flour for its operations.
ents is the 13th largest mill
The precise origins of the Atchiin the United States (three U.S. mills
son mill are unknown, but Pillsbury
have 20,000 cwts of daily capacity).
MGPI acquired the mill from The bought the facility in 1922 before it had
Pillsbury Co. in 1987. The mill supplies been fully constructed. Pillsbury went
feedstock to MGPI protein and starch on to finish work on the mill, a 5,000
cwt facility that was remodeled and
operations in Atchison and Pekin, Ill.
For many years, MGPI was able to updated extensively over the years.
operate the mill efficiently and consis- Capacity was 12,200 cwts when MGPI
acquired the facility in 1987.
tently, Mr. Newkirk said.
With the closing of the Atchison mill,
"In more recent years, however, utilization of the mill's capacity has been Kansas would remain the nation's largextremely erratic," he said. "This is est milling state with total daily capacity
due to a number of factors, including of 116,700 cwts, based on the 2008 Grain
changing market dynamics, changes & Milling Annual published by Sosland
in our protein and starch product Publishing Co. Kansas would be only
mix requirements, and volatile wheat slightly larger than California, at 106,600
prices, which reached record highs cwts, and Minnesota, at 101,430. MBN

Cargill to acquire Minnesota
elevator from Madison Energy
MINNEAPOLIS - Cargill has
signed an agreement to acquire a
grain elevator at Madison, Minn.,
owned by Madison Energy L.L.C., a
subsidiary of Glacial Lakes Energy,
L.L.C. The grain elevator, which was
acquired by Glacial Lakes from CHS
in December 2006, is equipped with
a grain dryer and features a 1.2-million-bu storage capacity.

Cargill said it expects to begin operating the facility in time to complete
this fall's corn harvest.
"Adding the Madison facility to our
regional elevator network increases
our flexibility in serving both export
and domestic grain markets, expanding the geography in which we can
offer Cargill's range of grain marketing solutions for producers," said Jim

Mrs. Fields emerges from bankruptcy
SALT LAKE CITY - Mrs. Fields' Original Cookies, Inc. announced it has
emerged from Chapter 11 bankruptcy
"with an improved balance sheet, a
good working capital position, and
new ownership." The company filed
for Chapter 11 in mid-August.
"The prepackaged bankruptcy filing
was the perfect means to complete the
company's reorganization," said Michael Ward, interim co-chief executive
officer. "Within 60 days of filing the
Chapter 11 petition, we were able to
significantly de-lever the company's
10 / November 4, 2008

Milling & Baking News

balance sheet, establish a credit facility
to support our working capital needs,
and emerge from bankruptcy fully capable of meeting and exceeding customer expectations."
Mrs. Fields said it used the bankruptcy process to create a solid foundation for the future success of its brands
and is now poised to generate profitable growth for its franchising, gifting,
branded retail, and licensing businesses,
the company said.
As part of its reorganization plan, Mrs.
Fields said it has acquired a 3-year, $10

Kabisch, farm service group leader for
Cargill AgHorizons' MnKota group in
Maynard, Minn. Cargill AgHorizons
operates grain elevator facilities in
nearby Maynard and Alberta, Minn.,
and in Vienna, S.D.
Glacial Lakes Energy owns and operates ethanol plants in Watertown
and Mina, S.D., and manages a plant
near Redfield, S.D. The company was
established in 2001 by the Glacial
Lakes Corn Processors and Glacial
Lakes Capital. In October, production
was halted at the Mina facility. MBN
million senior term credit facility from a
select group of its note holders that will
be used, in conjunction with cash flows
from normal operations, to support the
company's go-forward operations and
working capital needs. In addition, the
company said it has improved its balance
sheet by exchanging bondholder debt for
cash, new bonds and a controlling equity
stake in the reorganized company.
In 2009, the company expects to
open more than 40 new franchised
stores, grow its gifting and branded
retail businesses by more than 15%,
and grow its licensing business by approximately 30%. MBN
bakingbusiness.com / world-grain.com

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Milling & Baking News - November 4, 2008

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