TORONTO, ONTARIO--Stake Technology Ltd. (Nasdaq:STKL) (TSX:SOY) announced today that it has reached an agreement to acquire the business and operating assets of SIGCO Sun Products, Inc. ("SIGCO") of Breckenridge, Minnesota.
SIGCO is a world wide supplier of sunflower products and is fully integrated from the sale of sunflower seed to farmers through processing the contracted crop into finished in-shell and kernel sunflower products. The company operates four facilities located in Minnesota, North Dakota and Kansas.
SIGCO markets its non-genetically modified sunflower products throughout the United States and to international markets in Europe, Asia and the Americas. The company is a leader in high-oleic sunflower seeds which have a shelf life five times the traditional sunflower kernel, large in-shell sunflower seeds with increasing demand in world wide markets, and bakery kernels, where the company has developed a unique low cost production process to service North American and International markets.
SIGCO is highly compatible with Stake's vertically integrated business model. SIGCO's locations in the Mid-Western United States facilitate the integration of management and marketing strategies with Stake's Grains and Soy Products Group.
SIGCO, which has a history of profitability, had revenues of approximately $20 million in the last twelve months of operations.
Compensation in this transaction includes cash and the assumption of certain liabilities. No goodwill will initially be recorded as a result of this transaction. Closing of the transaction is subject to completion of definitive agreements and is expected by no later than October 31st.
Jay Schuler, who will remain as the President of SIGCO, commented "The Schuler family has been a pioneer in the confection sunflower business, dating back to 1958. We are happy to offer our producers a great alternative crop to grow and in turn provide excellent food ingredients to our ultimate customer, the food industry. Our SIGCO team has done an outstanding job of adding value to sunflower over the years. The Stake 'Sunrich Group' is a very successful company, with a similar objective, adding value to nutritional food. This transaction is a positive for all; producers, ingredient customers, employees, and stockholders. I expect the development of value added products utilizing the healthful sunflower to increase with the combined operations. This is a very good fit."
Jeremy Kendall, Chairman and CEO of Stake, commented that, "The acquisition of the business and operating assets of SIGCO is a great addition to our vertically integrated Food Group. In addition to our current portfolio, SIGCO extends the breadth of our product offering of healthy food products to our customers."
Stake Technology Ltd., to become SunOpta Inc. effective October 31, 2003, is an owner/operator of high-growth ethical businesses, focusing on integrated business models in the natural and organic food markets. For the last five consecutive years, Stake was included in Profit magazine's 'Profit 100' list of the 100 fastest growing companies in Canada. The company has three business units: the Food Group, which specializes in sourcing, processing and distribution of natural and organic food products; integrated from seed through packaged products; the Environmental Industrial Group; a producer, distributor, and recycler of environmentally friendly industrial materials; and the Steam Explosion Technology Group who engineer and market clean pulping systems using patented steam explosion technology. Each of these business units has proprietary products and services that give it a solid competitive advantage in its sector.