Lansing Sells 20% Stake to New Hope to Boost Sales in Asia

  • New Hope invests $127.5 million in U.S. grain, ethanol trader
  • Companies expand client-supplier relationship into partnership

Lansing Trade Group LLC, a 93-year-old U.S. grain and ethanol trader, plans to expand sales in Asia after selling a minority stake to a subsidiary of China’s New Hope Liuhe Co.

New Hope paid $127.5 million in cash for a 20 percent equity interest, Overland Park, Kansas-based Lansing said Tuesday in a statement on its website. The U.S. company stores and trades whole grains, feed ingredients and energy products, while Chengdu-based New Hope is involved in animal-feed manufacturing, meat processing, livestock and poultry breeding, as well as animal production, according to the statement.

Lansing has been a supplier to New Hope of products including dried distillers grain, a feed ingredient that’s a byproduct of ethanol production, Tom Carew, Lansing’s executive vice president and general counsel, said in a telephone interview on Wednesday.

“It fits our strategy for long-term growth in China and Southeast Asia,” Carew said.

New Hope’s investment underscores the appeal of North American grain handling by domestic and international buyers, especially as surplus harvests are moved from the Americas to Asia and other regions of growing demand. Mergers and acquisitions in the grain handling industry may increase after crop prices drop and margins narrowed in the past year.

Lansing transports more than 21 million metric tons of grain and 17 million barrels of energy products annually, according to its website. It also has more than 65 million bushels of storage capacity and 40 commodity handling facilities.

Other investors in Lansing include Australia’s Macquarie Group Ltd. and Andersons Inc., a Maumee, Ohio-based agricultural company. The Andersons said on Nov. 5 that a drop in Lansing’s performance, partly due to lower Chinese demand for dried distiller grain and a decline in U.S. energy markets, contributed to lower profit for its grain group in the third quarter.

Andersons spokeswoman Debra Crow and Macquarie spokesman Rishi Sharma declined to comment.

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