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P&G sellsCrisco, Jif

to Smucker's

Volume 12 • December 200 I • Inform

News

J.M. Smucker Co. of Orrville, Ohio, thejellies and jams firm, is acquiringProcter & Gamble's (P&G) Crisco andJif brands.

P&G announced in October that itwill first spin off and then immediatelymerge its Crisco shortening and cookingoils and Jif peanut butter businessesinto the Smucker organization, pendingregulatory review. Structuring the trans-action rhar way, rather than simply sell-ing the brands, is intended ro make thedeal tax-free to both firms.

Crisco was P&G's first food product,as well as the first vegetable shorteningsold to consumers, beginning in 1911{inform 12:730, 200 I J.

With annual sales of $350 and $300million per year, respectively, the Criscoand Jif businesses are roughly equal tocurrent sales revenues for Smucker's,allowing Smucker's to structure thetransaction finances in a way rhnr willmake the transfer tax-free to P&Gshareholders and thus more valuablethan an outright sale, according toSteven Ellcessor, vice president offinance and adminisrrarion and generalcounsel for Smucker's.

Although the financial benefits arcevident and the fit of No.1 peanut but-ter brand Jif with Smucker's jellies andjams business is dear, the firm's interestin a shortenings and oils business is lessso,

"If you look at it from a raw mnreri-als poinr of view, it doesn't seem obvi-ous. Bur if you look at the Crisco busi-ness in terms of its consumer, where it isin the (retail) store, how it's used, andhow it fits into American food history,there are more complements than youmight think," EI1cessor said, addingthat Crisco's well-established dismbu-rion channels were an added nrrrncrion.

"Sales of shortening have not beengrowing," he admitted. '""BUT people

who cook will still use oil. We thinkthere arc lots of opportunities to sup-port the Crisco brand, particularly onthe oil side."

Pending regularory review, share-holder approvals, and the receipt of aruling from the Internal RevenueService rhar the transaction is tax-free to

both companies, the deal is expected to

be final as early as April of 2002,Ellcessor said.

P&G joint venturewith Coke loses fizzThe proposed snacks-and-drinksjoint venture linking P&G with theCoca Cola organization has beencalled off.

The project, originally announced inFebruary 2001, would have combinedP&G's snack unit, including its Pringlespotato chip brand, Eagle Snacks brand,and Sunny Delight and Punica juicebeverage brands, with Coke's MinuteMaid juice drink line (inform12:490-491 ).

P&G hns no plans to put its snacks-and-beverages businesses back on theauction block, a company spokesper-son said, adding that P&G is "devol-oping business plans to move forwardwith Pringles and the beverage busi-ness . .,

Engelhard buys catalystbusiness from Siid-ChemieEngelhard Corporation has purchasedSlid-Chemic's Iars and oils catalyst busi-ness. Terms of the acquisition were notannounced.

Sud-Chcruie's other products, such asbleaching ear-ths, were not involved inthe sale.

Engelhard purchased Sud-Chemic'sedible and inedible catalyst technology,

Richard Gay, business director ofEngelhard's oleocbemical businessgroup, said. Catalysts are used in theedible oil business to hydrogenate fatsand oils to improve srabihry or func-rionaliry, and to produce materials usedin the manufacture of oleochemicals foruse in nonedible products.

With the new product line,Engelhard intends to expand its clientbase.

"This purchase presented us with anopporruniry to offer more products toour customers than we have today,"Gay explained. "There are also a coupleof customers that Sud-Chemic was sell-ing to that we will now be able to sellto. "

Engelhard purchased three catalysttrade names: G95D, G53H, and G 135.In addition, the company bought equip-ment from Sud-Chemic's Louisville,Kentucky, plant, that was used to man-ufacture the fats and oils catalysts it haspurchased. The equipment will bemoved to Engelhard's plants in Elyria,Ohio; Erie, Pennsylvania; and TheNetherlands, Gay said.

"We will move around our productsand put their products in so we can startto fill out our line. We have an agree-ment with Sud-Chemic where they will[produce] for us for nine months," heexplained.

During that transition period,Engelhard will work with its customersto evaluate the new catalysts, Gay said.

Some Sud-Chemic employees work-ing on the fats and oils catalyst linemay be transferred to other Slid-Chemic locations or laid off after thetransition period, said Richard Power,community relations manager at Slid-Chemie.

Power said the sale was made to helpSud-Chemie get back "to its core com-petencies ."

Bunge to buyLa Plata CerealBunge Ltd. has announced that it willbuy Argentina-based La Plata Cereal SAfrom Andre & Cie SA, the Swissagribusiness firm tied to Andre Groupsthat went out of business in June.

Bunge, based in White Plains, NewYork, has agreed to pay up to $70 mil-lion in cash and assume La Plata Cereal'sdebt as part of the deal, according to aBunge news release. The deal is expectedto be completed during the first quarterof 2002, and would make Bunge thelargest soy processor in Argentina, aswell as adding to its standing as Thebiggest fertilizer company in SouthAmerica, a news release said.

La Plata has four main lines of oper-ation: grain origination, soybean pro-cessing, fertilizer production, and portsand logistics. It owns six grain eleva-tors, one soybean processing plant, aport facility in Puerto San Martin, and aferrilizer business with a 10% share of[he Argentine market.

In late March of 2001, Andre & CieSA and Bunge Ceval reached un agree-ment under which La Plata Cereal sup-plied Bunge's Argentinean operationswith soymeal and related products. Atrhar time, there were no plans to sell,but a representative of Andre Groupssaid the option had not been ruled out.Andre Groups closed for business inJune (inform 12:612, 829).

Crown, Friendship announceChina joint ventureCrown Iron Works of Minneapolis,Minnesota, and Wuh::an FriendshipEngineering Corporation in China haveannounced a joint venture, CrownFriendship Engineering.

Wuhan Friendship specializes in pro-cessing capacities of up to 1,200 metric

11'17

tons daily, whereas Crown Iron has spe-cialized in high-capacity facilities.China's rising demand for soybean oiland meal has created a demand forplants capable of handling up to 3,000metric tons daily, so Crown FriendshipEngineering will have [he capability tomeet potential customers' diverse needs.

Rerrofiniug existing plants also willbe provided by The venture, accordingto Cliff Anderson, president and chiefexecutive officer of Crown Iron Works.

As of mid-September, the firms werewaiting for expected Chinese federal gov-ernment approvals of the new enterprise.

Soy-foods company plansexpansion, new facilityWildwood Harvest Inc., a soy-foodscompany created by the merger ofWildwood Natural Foods and MidwestHarvest, plans to build a 20,OOO-square-foor soy-food manufacturing facility inGrinnell, Iowa, and to remodel an exist-ing facility in Watsonville, California.

Wildwood Natural Foods, based inFairfax and Santa Cruz, California, andMidwest Harvest, based in Grinnell,Iowa, merged in late AugUST 2001 tocreate Wildwood Harvest.

Wildwood"s California operations willbe consolidated into the Watsonville plant.Thecompany also plans to introduce a lineof soy-based dairy analogs, to be producedin the Grinnell facility.

Groundbreaking for the new faciliryin Grinnell Took place in late September.The facilities are expected to be com-pleted during the first half of 2002.When the two facilities are completed,Wildwood Harvest said its annual soy-bean usage of 30,000 bushels (816 met-ric tons) should triple.

Financing for the expansion projectsincluded a $3.3 million investmem bytecTERRA Food Capital Fund and a

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$700,000 investment by the Iowa FarmBureau Federation.

Bunge to marketsoy drinks in BrazilBunge Alimenros, Bunge's Brazilianbranch, has announced plans to investalmost $1.8 million TO market a newline of soy drinks.

The five different "All Day" soy-basedfruit drinks will be aimed at health-conscious Brazilians. Bunge said it hopesTO have a 5% share of the Brazilianhealth/soy market in the next few years,according TO a company news release.

Bunge Alimcnros is Brazil's second-largest food company.

To some, soy foods lookbetter than they tasteDo the Ij.S. farmers who grow the soy-beans that are used in the expanding soy-foods marker walk the walk or only talkthe talk about eating soy foods, won-dered Brmn W~lnsink of the University ofIllinois at Urbana-Champaign?

Wansink visited eight farmers in theirhomes in central Illinois and easternIowa TO conduct informal surveys andthen share a farm lunch, in order togauge if the farmers' talk about soy-food products meshed with their truefeelings. To a man, the farmers said thatsoy is healthy, tastes great, and manyhinted that they had begun eating moresoy-based food products.

"It is difficult to establish if whatpeople say is consistent with what theydo," Wansink noted, adding that in-home visits were one way TO get to theheart of the matter;

Unbeknownst 10 each farmer, one ofWansink's students had met earlier witheach farmer's wife and had her pick outa recipe or soy-food product that would

Volume 12 ' Oecember 200 I • Inform

News

be most like what the farmer normallyate for lunch. In most cases, that waseither a casserole or some type of loose"meat" sandwich, Wansink said.

A video camera picked up the farmers'reactions-including many grimaces-asthey tasted the soy food and blurted"What is this?" and "What's going on?"at their wives. Five of the eight farmerspushed their plates away or leaned backto look for something else to eat.

"When it comes to accepting soyfoods, taste still dominates behavior,"he said. "Regardless of what a personbelieves or is motivated to believe aboutsoy, the test is still in the taste."

Wansink is an associate professor ofmarketing and agricultural economics atthe University of Illinois at Urbana-Champaign and director of its Food andBrand Laboratory. He spoke about hisrecent research at a breakfast meeting ofthe Champaign-Urbana (Illinois)Chamber of Commerce on Sept. 13,2001. His papers are available online atwww.consumerpsychology.com.

Salad-dressing productionrises in Japan during 2000

Japanese salad-dressing production III

2000 was 142,000 metric tons, a 14%increase from the previous year.

According to a report in Yushi, aJapanese monthly magazine on fats andoils, the Japanese dressings marker wasworth $356 million in 1997; by 2000, itwas worth $428 million.

Especially popular dressings ill Japaninclude mayonnaise and sesame-typesalad dressings.

Hammer selectedto head NOPAThomas Hammer has been appointcdpresident of the National Oilseed

Processors Association (NOPA), to suc-ceed Allen Johnson, who is the newchief agricultural negotiator in theOffice of the United States TradeRepresentative.

Hammer is the former president andchief executive officer for Hammer andCompany, a consulting firm in FallsChurch, Virginia. He has been an ad-viser to companies and trade associa-tions on agricultural and internationaltrade issues. He previously worked forthe American Farm Bureau Federationand was a deputy undersecretary of theU.S. Department of Agriculture duringthe 1980s.

B.Y.Patelto head SEABipin V. Patel, managing partner of ,WsS.K. Industries in Junagadh, has beenelected president of The SolventExtractors' Association (SEA) of India.

Other newofficers for2001-02 electedduring the SEA'sannual rueeringduring lateSeptember wereD.P. Khandelia,director of MisKhandclia Oiland General Mills Ltd. in Chandigarh, asvice president. P.H. Kader, managingdirector of Mis Liberty Oil Mills Ltd. inMumbai, as the new secretary; O.P.Garg, chairman and managing directorof Mis K.S. Oils Ltd. in Morena, as cen-tral zone chairman; B.C. Rajpur, chair-man of Mis Gokul Rcfoils and SolventLtd. in Sidhpur, as west zone chairman;M.R. Rao, managing director ofGowrhumi Solvent Oils Ltd. in Tanuku,as south zone chairman; A.R. Sharma,managing director of Mis A.P. Solvent

I,

IIII

B.V. Patel

Pvt. Ltd. in Dhuri, as north zone chair-man; and A. Serbia, executive director ofMIs Serhia Oils Ltd. in Kolkara, as eastzone chairman.

B.V. Mehta, executive director ofSEA for the past 25 years, was recog-nized for his service. Outgoing presi-dent, Sandeep Bajoria, also was cited atthe meeting for "visionary leadershipand dedicated efforts for the cause ofthe vegetable oil industry."

Nobel Prizes markcentennial in 200 I

This year marks the centennial for rheNobel Prizes, which were first presentedin 1901, with the 2001 awards sched-uled to be presented Dec. 10 in Sweden.

The prizes were created in the will ofAlfred Nobel, a Swedish inventor whobecame rich in part because of his dis-covery of how to make dynamite, a rel-arively stable explosive. Nobel said hewished to be remembered for construc-tive accomplishments, and thereforecreated the prizes in his will. Nobel diedin 1896; the first awards were presentedon the fifth anniversary of his death.

During the past 100 years of awardsin chemistry and medicine/physiology,three have related directly to fats andoils, and all were presented in the med-icine/physiology category.

In ·1964, Konrad Bloch of the UnitedStates, who spoke at the 1988 AOCSmeeting in Phoenix, Arizona, andFeodor Lynen of Germany received theprize for their discoveries concerningthe mechanism and regulation of cho-lesterol and fatty acid metabolism.

Almost rwo decades later; in 1982,Sune Bergstrom, Bengr Samuelson, bothof Sweden, and John Vane of the UnitedKingdom received a abel Prize for theirdiscoveries related to prostaglandins andrelated biologically active substances.

Three years after that, in 1985,Michael S. Brown and Joseph Goldsteinof the United States were recognized fortheir research on the regulation of cho-lesterol metabolism.

Please passthe pink ParkayConAgra has introduced "FunSqueeze," a squeezable Parkay mar-garine line meant to appeal to children.

The spread comes in 10-ounce bot-rles that have squeeze grips, flip-topcaps, and smaller spouts than used onregular squeezable Parkay containers.

The spreads are available in blue orpink, echoing Heinz's child-friendly"green" catsup line, according to 3company news release.

BriefsOffices for the National Institute ofOilseed Products (NlOP) are now at1156 15th St. NW, Suire 900,Washington, DC 20005. The telephonenumber (202-785-3232), fax number(202-223-9741), and e-mail address(NJOP@assnhq.com) have nOTchanged.

AOCS member Blake Hendrix hasjoined Intellectual Property Holdings(IPH) LLC of Omaha, Nebraska, 3 sub-sidiary of Ag Processing Inc. (AGP), asvice president, marketing and sales.Hendrix previously was with A1fa Lav31Inc. in Greenwood, Indiana. AGP alsoannounced appointment of Rob Flackto group vice president, animal nutri-tion, and of Wayne Stockland as vicepresident, nutrition and technical ser-VICes.

Fuji Oil has completed construction of anew $32 million chocolate productionplant in Kauro, Japan. The plant is

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expected to have an annual productioncapacity of 10,000 metric tons.

The Southern African SoyfoodAssociation has established a homepage on the Internet (netlink: www.soyfood.co.za). The association wasformed approximately two years ago.

Archer Daniels Midland Co. (ADM)has announced a restructuring of itsfood and bioproducrs units into distinctdivisions. Tony Delio will head the newhealth and nutrition operation; SeenFredericksen will lead the specialtyingredients division, which includesproteins, specialty fats, and emulsifiers;and Kevin Burgard will direct the feedgroup. The company also has made thefollowing appointments: Mark Bemis,president of ADM Cocoa; Fred Baine,merchandising manager of the NorthAmerican Soybean Division; MichaelBaroni and Daniel Larson, vice presi-dents of the Specialty IngredientsDivision; and Patricia Schroder, vicepresident of the Natural Health andNutrition Division and GeneralManager of the ADM/Kao diacylglyc-erol joint venture. ADM is based inDecatur, Illinois.

ADM also has announced that it willmerge Moorman's Inc. andConsolidated Nutrition to form ADMAlliance Nutrition, with Mike Foster aspresident. Headquarters for The newsubsidiary will be in Quincy, Illinois.The change was expected to take placeNov. 1.

Britannia Food Ingredients Ltd. ofGoole, England, has named JensKrisron to its staff to promote exportsales. The firm is an edible oils and fatsrefining firm specializing in confec-tionery fats and specialty frying oils.O

Volume 12 - December 2001 • Inform