May 14, 2015 / 8:34 PM / 2 years ago

INTERVIEW-Canada grain handler Richardson targets U.S. acquisitions

3 Min Read

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By Rod Nickel

WINNIPEG, Manitoba, May 14 (Reuters) - Richardson International, one of Canada's largest grain handlers, is seeking expansion in the United States through acquisitions worth C$100 million to as much as C$2 billion ($1.67 billion), its chief executive said on Thursday.

Richardson, which now owns two U.S. mills, is interested in Andersons Inc and private companies Bartlett and Scoular, as well as co-operatives, Chief Executive Curt Vossen said in an interview at the company's Winnipeg head office.

Andersons' shares on Nasdaq spiked as much as 13 percent shortly after Vossen's comments were published, touching a three-month high, before finishing up 7.5 percent at $45.09.

Vossen said Richardson has had no discussions with those companies and that it was unclear if they are willing to sell.

Richardson is also looking to expand to Latin America, Australia and Eastern Europe, where more crop is produced than can be consumed domestically.

But the United States "is the logical growth direction," Vossen said. "We don't have to be the largest, but we have to be meaningful.

"There's no point in acquiring small businesses if they don't move the EBITDA needle for the organization in an effective way."

Vossen said if Andersons, long considered by analysts as a takeover target for its grain storage and rail cars, Bartlett or Scoular are willing to sell, Richardson would have to outbid North American and Asian competitors.

Andersons spokeswoman Debbie Crow said the company does not comment on speculation. Bartlett and Scoular spokespersons could not be reached immediately.

Andersons, which has a $1.2 billion market cap, has an attractive size, but also significant family ownership that could complicate a transaction, Vossen said.

Richardson is interested in U.S. assets in grain-handling, processing and crop inputs, mainly in wheat-growing areas, he said.

The company may build U.S. assets once it acquires a critical mass, he added.

Legumex Walker Inc has said it is open to a sale. Vossen said he is not interested in Legumex's Washington-state canola-crushing plant and is undecided about its special crop assets.

Richardson, the largest division of James Richardson & Sons Ltd, has a share of Western Canada grain-handling capacity similar to that of Glencore Plc's Viterra Inc .

Richardson is currently trying to close one acquisition in Western Canada and one in Eastern Canada, Vossen said, declining to give details.

Richardson's last big deal was its C$900 million purchase of certain Viterra assets when Glencore bought the Canadian company in 2012.

$1=$1.20 Canadian Reporting by Rod Nickel in Winnipeg, Manitoba; editing by Chizu Nomiyama; and Peter Galloway

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