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EXHIBIT 99.1
CONTACTS: Jeffrey T. Cook Roanne Kulakoff
President and CEO Lissa Perlman
Penford Corporation Kekst and Company
425-462-6000 212-521-4800
[email protected]
FOR IMMEDIATE RELEASE
PENFORD CORPORATION TO ACQUIRE STARCH AUSTRALASIA
-- ACQUISITION IMMEDIATELY ENHANCES PENFORD'S REVENUE AND EARNINGS OUTLOOK --
BELLEVUE, WA, August 29, 2000 -- Penford Corporation (Nasdaq: PENX), the leading
producer of specialty starches in North America, today announced that it intends
to acquire Starch Australasia Limited from Goodman Fielder Limited for
approximately $58 million (USD) in cash. The transaction is expected to close by
September 29, 2000 and is subject to customary closing conditions.
Starch Australasia is Australia's sole producer of maize starch products and a
world leader in the research, development and commercialization of novel new
starch-based products. Starch and starch-derived ingredients are used to enhance
the functionality of packaged food products, as well as industrial applications.
Starch Australasia had fiscal 2000 revenues of approximately $70 million (USD)
and employs approximately 300.
The acquisition of Starch Australasia will provide Penford with new
opportunities to develop, manufacture and market specialty carbohydrate-based
ingredient systems for its food, paper and textile customers. Specifically,
Penford will gain additional high growth potential food grade starch products
and expanded market access, as well as a regional platform for manufacturing
specialty starches for the fast growing Asian paper industry.
Jeffrey T. Cook, President and Chief Executive Officer, said, "Penford continues
to gain recognition as the leader in applying carbohydrate-based science to
develop sophisticated ingredient systems that improve customers' products. The
added capabilities from Starch Australasia will enhance our ability to further
commercialize new specialty starches and value-added ingredient system
formulations that provide convenient, natural and cost effective solutions for
our customers.
"With the addition of Starch Australasia, Penford will have a worldwide food
ingredients business with a comparable revenue base to our industrial
ingredients business. Our food ingredient portfolio will now span almost the
entire high value food grade corn ingredient spectrum, including waxy, high
amylose and maltodextrins. The acquisition will also provide Penford with
immediate entry into the emerging market for functional food ingredients,
initially through patented Hi-maize resistant starch."
Resistant starches increasingly are being recognized for their dietary fiber
benefits. In 1995, Hi-maize resistant starch was awarded the Australian
Institute of Food Science and Technology's prestigious Food Industry Innovation
Award. Hi-maize resistant starch is an ingredient in all McDonald's hamburger
buns and muffins in Australia and is a key factor in the success of Australia's
leading white bread.
"Overall, we see tremendous leverage on both sides of the Pacific by adding
Starch Australasia's capabilities to Penford's leading North American position
in providing natural-based ingredient systems to a growing food and industrial
customer base," Mr. Cook concluded.
In addition to portfolio and market expansion opportunities, Penford was
attracted to Starch Australasia for its experienced management team and
strategic manufacturing sites. The acquisition includes three world-class
manufacturing facilities, one in New Zealand and two in Australia, for
processing specialty corn starches and wheat related products.
Penford intends to finance the acquisition through a new, $130 million credit
facility from a syndicate of banks.
Penford Corporation develops, manufactures and markets specialty
carbohydrate-based ingredient systems for various
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applications, including papermaking, textiles and food products.
This press release contains forward-looking statements concerning the
acquisition of Starch Australasia and the future performance of the combined
Company's specialty starch-based ingredient systems and products. There are a
variety of factors which could cause actual events to differ materially from
those projected in the forward-looking statements such as unforeseen
difficulties of integrating the two businesses, decreases or delays in customer
demand or orders, increased competition, decreases in market share, unfavorable
changes in product mix, disappointments in product development efforts, interest
rate and energy cost volatility, foreign exchange rate fluctuations and those
listed in the Company's SEC reports, including the reports on Form 10-K for the
year ended August 31, 1999.
For automated shareholder information, please call 888-317-2013.
