Minneapolis, MN, (July 8, 2019) – Ceres Global Ag Corp. (TSX: CRP) (“Ceres” or the “Company”), a global agricultural, energy and industrial products merchandizing and supply chain company, announced today that it has secured an exclusive option to acquire Delmar Commodities, Ltd. based in Winkler, Manitoba (“Delmar”). Subject to successful completion of due diligence activities and the finalization of a definitive share purchase agreement, Ceres hopes to close this potential acquisition on or about August 1, 2019.
Under the terms of the option agreement, Ceres has the right through July 31, 2019 to purchase all of Delmar’s issued and outstanding shares for CAD $16 million in cash paid to Delmar’s shareholders, and the assumption of approximately CAD $7.6 million in existing term debt. Delmar would operate as a subsidiary of Ceres, with Delmar’s operations and approximately 55 employees strategically integrated into Ceres’ overall operational network.
“We believe the addition of Delmar’s grain assets to be an important first step in adding strategic origination for our core products, while also significantly advancing our portfolio diversification strategy with the inclusion of their soybean crush, agricultural seed sales & distribution and birdfeed product lines,” said Robert Day, President and Chief Executive Officer of Ceres. “We see significant value in Delmar’s capabilities, market knowledge and customer relationships, but perhaps the most attractive aspect of Delmar is its people and their talent. This potential combination is an important step for Ceres as we execute our growth strategy, and we look forward to untapping the potential our teams can have working together.”
“We are excited about the prospects of being a part of Ceres’ business and team,” said Dale Heide, President of Delmar. “Delmar’s growth ambitions and plans, combined with Ceres’ customer network and access to capital, would provide us with a unique opportunity to profitably grow together.”
Ceres commenced due diligence on a potential acquisition of Delmar in February 2019. There can be no assurance that Ceres’s due diligence will be concluded to its satisfaction or that an acquisition will be successfully concluded.
About Ceres Global Ag Corp. (ceresglobalagcorp.com)
Through its network of commodity logistics centers and team of industry experts, Ceres procures and supplies North American agricultural commodities and value-added products, industrial products, fertilizer, energy products and reliable supply chain logistics services to customers worldwide.
Ceres operates five locations, Duluth, MN; Minneapolis, MN; Shakopee, MN; Northgate, Saskatchewan; and Port Colborne, Ontario, and is headquartered in Minneapolis, MN. Its facilities throughout North America have an aggregate grain and oilseed storage capacity of approximately 29.7 million bushels.
Ceres also has a 50% interest in Savage Riverport, LLC, a joint venture with Consolidated Grain and Barge Co., a 25% interest in Stewart Southern Railway Inc., a short-line railway located in southeast Saskatchewan with a range of 130 kilometers, and a 17% interest in Canterra Seed Holdings Ltd, a Canada-based seed development company.
For more information, please visit www.ceresglobalagcorp.com
About Delmar Commodities, Ltd.
Delmar Commodities, Ltd. is a Manitoba-based agricultural processing and supply chain company with four primary business lines: Grain merchandizing, soybean crush, birdfeed production and sales, and is the exclusive distributor in western Canada of Legend Seed products under a license and distribution agreement with Legend Seeds, USA.
For more information, please visit www.delmarcommodities.com.
For more information please contact:
NATIONAL Capital Markets