Milling & Baking News - May 24, 2016 - 10

Business X

The Andersons turns down
takeover overtures from HC2
MAUMEE, OHIO - The board of directors of diversified ag processor The Andersons, Inc. has rejected not one, but
two, non-binding, highly conditional,
unsolicited proposals from Herndon,
Va.-based HC2 Holdings, Inc. to acquire
all outstanding shares of The Andersons. The Andersons disclosed the bids
after HC2 Holdings issued a statement
May 17 about its intentions.
The Andersons said it received an
initial private, unsolicited proposal
from HC2 to acquire the company for
$35 per share in cash on Jan. 29. A subsequent proposal was submitted on
March 22 for $37 per share in cash, or
about $1.043 billion, plus the assumption of $402 million in debt.
The $37 bid represented a 21% premium above the March 22 closing
price of $30.50 and a 43% premium
above the May 17 close of $25.94. Since
The Andersons disclosed the bids, the
company's share price has rallied to
around $32 at mid-week with an intraday high above $35.
"We believe HC2's proposals ignore
our value and prospects as a standalone entity and represent an opportunistic attempt to acquire the company
at a low point in the industry cycle,"
said Michael J. Anderson, chairman
of The Andersons. "Following a thorough review, and in consultation with
our independent financial and legal
advisers, our board determined that
the offers are not credible, significantly understate the company's true value and are not in the best interests of
our shareholders. Our board and management team remain confident in our
ability to execute on our standalone

plan and believe we are well positioned to continue to create significant
long-term value for shareholders."
Philip A. Falcone, chairman, president and chief executive officer of
HC2, said a potential acquisition of
The Andersons is consistent with the
company's strategy of pursuing cash
flow positive businesses that enhance
the overall shareholder
value for the company.
Founded in 1994, HC2
Holdings is a publicly
traded diversified holding company with a diverse array of operating
subsidiaries across seven
reportable segments, including manufacturing, marine services, utilities, telecommunications,
life sciences, insurance and other. With
its shares trading on Nasdaq, HC2
Holdings has a market capitalization
of $145 million, or roughly 14% of its
bid for The Andersons.
"We are confident in our ability to
complete the transaction given that
there are no financing conditions and
our exclusive understanding with
a qualified strategic partner that is
aligned with us to complete this transaction," Mr. Falcone said.
HC2 made its proposals public after
it said The Andersons failed to reply in
a timely manner. In a May 17 letter to
Mr. Anderson, Mr. Falcone said HC2
believes The Andersons has been poorly managed and has not been effective
in extracting synergies of any significance from the five disparate corporate
entities it owns, controls and operates.
"A $100 million budget to build a

Bimbo inaugurates Global Shared
Services center in Costa Rica
MEXICO CITY - Grupo Bimbo S.A.B.
de C.V. on May 6 inaugurated its new
Global Shared Services Center (GSSC)
in the Tres Ríos district, located in La
Unión de Cartago in Costa Rica. Grupo Bimbo said it invested more than
$2.5 million in the construction of the
facility, which wrapped up in April.
The center already has more than 80
employees working, a number that is
expected to rise to more than 200 job
positions filled by the end of 2017.
"Today we celebrate the creation of
200 new jobs before the end of next
10 / May 24, 2016 XMilling & Baking News

year, jobs in fields such as English
language, finance, accounting and
customer service," said Costa Rica
President Luis Guillermo Solis Rivera.
"Grupo Bimbo has attained the consolidation of its operations in Costa
Rica, with foreign investment bringing jobs and well-being, for which we
are very happy, and thus we are committed to continued strengthening
of competitiveness conditions in our
country."
Ruben Marquez, vice-president
of Global Shared Services for Grupo

new corporate headquarters, a bloated
corporate overhead expense structure
coupled with a poor operating performance, weak earnings and a stock that
is dramatically underperforming the
market and down over 60% from September 2014, only crystallizes our concern that the company's value proposition model has eroded and is at risk
for further decline," Mr. Falcone said.
"Hence, we believe action is necessary
to maximize value from these assets,
for all shareholders, and urge the board
to commence a process
immediately. While we
continue to be interested
in acquiring 100% of the
company, the disparate asset base may prevent traditional strategic buyers
from any meaningful participation in an auction as
a whole. Therefore, we are prepared to
work with the board to maximize shareholder value and will offer, as an alternative to acquiring all of The Andersons, $950 million for the acquisition of
two of the corporate entities: the Grain
Group (excluding the investments in
Lansing and Thompson's) and the Rail
Group. In addition, HC2 will provide
stalking horse bids for each of the remaining assets in a sale process, including the Ethanol Group, Nutrient Group,
Retail, as well as The Andersons' investments in Lansing, Thompson and other
corporate assets, thereby minimizing
downside risk for shareholders in an
auction for those assets."
For its part, The Andersons said
HC2's letter "contained numerous inaccuracies and misleading statements."
Among others, HC2's claim that The
Andersons did not substantively respond to its $37 per share offer is "patently false," the company said. MBN
Bimbo, added, "We have been in Costa
Rica for 20 years now, and this new operation strengthens our global shared
services capacity and braces our faith
in the talent and leadership of its people, together with whom we expect to
shoulder new challenges to create new
capacities and grow together."
Grupo Bimbo said it made the decision to install the GSSC in Tres Ríos
after careful analysis.
"This is a strategic location for our
collaborators given its ease of access
and its proximity to residential areas and to the main higher education
centers of the country," said Jazmín
Alvarado, GSSC vice-president for
Grupo Bimbo in Costa Rica. MBN
bakingbusiness.com / world-grain.com

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - May 24, 2016

Table of Contents for the Digital Edition of Milling & Baking News - May 24, 2016