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New Horizon Co-Op sale plan falls short on votes
About 64 percent of voting stockholders approved of selling to Beachner Grain, but two-thirds majority was not reached
By Bob Harrington, bharrington@miconews.com
It’s back to the drawing board for the New Horizon Farm and Home Cooperative board of directors after a stockholder vote failed to garner enough support Tuesday night for a proposed sale of the co-op.
More than 350 people — 309 of them eligible voters — crowded the community building at the Anderson County Fairgrounds in Garnett. The proposal to sell substantially all of the assets of the cooperative to Beachner Grain Inc. of St. Paul, Kan., was defeated on a vote of 197-112, which left New Horizon nine votes short of the two-thirds majority requirement of 206 in-person ballots in favor of the sale. Proxy votes are not allowed by the cooperative’s bylaws.
Members of the board met Wednesday afternoon with New Horizon’s lenders and legal council. It was decided to reopen the bidding for the sale of the co-op until April 1, while New Horizon also looks for companies with which to merge, Aust said.
One asset the board agreed to sell separately was a one-third interest in East Kansas Chemicals with the other owners slated to purchase New Horizon’s share.
Two informational meetings on the proposal to sell to Beachner took place earlier this month — one in Paola and the other in Garnett.
Cooperative members were told that, in essence, they have only two choices: to sell or to be taken into bankruptcy April 1 by Frontier Farm Credit, the cooperative’s financial backer.
Brad Aust, chairman of New Horizon’s board, said after Tuesday night’s vote that the fate of New Horizon now is in the hands of Frontier Farm Credit.
“I don’t know what options, if any, they will be willing to negotiate with us,” he said. “They can foreclose on us at any time.”
Beachner Grain Co. has been in business since 1987. It owns 19 grain, feed and fertilizer facilities in Kansas and Oklahoma, including one at Richmond, south of Ottawa. The company has not had any experience in the fuel sales included in New Horizon operations, but at the time of the offer to purchase New Horizon, it promised to keep all options open and provide the same service.
New Horizon Farm and Home resulted from an August 2006 merger of Miami County Cooperative Association and United Cooperatives Inc. of Garnett; the two had cooperatives in Miami, Linn and Anderson counties. New Horizon purchased Ligon Feed and Supply of Paola and Louisburg on July 1, 2006, effectively eliminating a small competitor in those two communities. New Horizon began with 13 locations and 75 employees in 10 towns.
Members of the New Horizon board are Lloyd Ohlmeier of Paola, Jim Meinig of Paola, Richard Watson of Fontana, Brad Aust of La Cygne, Ernie Troth of Mound City, Steve Stainbrook of La Cygne, Ron Eastwood of Fontana, Ron Dunbar of Richmond and Gene Highberger of Westphalia. All board members were present for Tuesday’s vote.
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More than 350 people — 309 of them eligible voters — crowded the community building at the Anderson County Fairgrounds in Garnett. The proposal to sell substantially all of the assets of the cooperative to Beachner Grain Inc. of St. Paul, Kan., was defeated on a vote of 197-112, which left New Horizon nine votes short of the two-thirds majority requirement of 206 in-person ballots in favor of the sale. Proxy votes are not allowed by the cooperative’s bylaws.
Members of the board met Wednesday afternoon with New Horizon’s lenders and legal council. It was decided to reopen the bidding for the sale of the co-op until April 1, while New Horizon also looks for companies with which to merge, Aust said.
One asset the board agreed to sell separately was a one-third interest in East Kansas Chemicals with the other owners slated to purchase New Horizon’s share.
Two informational meetings on the proposal to sell to Beachner took place earlier this month — one in Paola and the other in Garnett.
Cooperative members were told that, in essence, they have only two choices: to sell or to be taken into bankruptcy April 1 by Frontier Farm Credit, the cooperative’s financial backer.
Brad Aust, chairman of New Horizon’s board, said after Tuesday night’s vote that the fate of New Horizon now is in the hands of Frontier Farm Credit.
“I don’t know what options, if any, they will be willing to negotiate with us,” he said. “They can foreclose on us at any time.”
Beachner Grain Co. has been in business since 1987. It owns 19 grain, feed and fertilizer facilities in Kansas and Oklahoma, including one at Richmond, south of Ottawa. The company has not had any experience in the fuel sales included in New Horizon operations, but at the time of the offer to purchase New Horizon, it promised to keep all options open and provide the same service.
New Horizon Farm and Home resulted from an August 2006 merger of Miami County Cooperative Association and United Cooperatives Inc. of Garnett; the two had cooperatives in Miami, Linn and Anderson counties. New Horizon purchased Ligon Feed and Supply of Paola and Louisburg on July 1, 2006, effectively eliminating a small competitor in those two communities. New Horizon began with 13 locations and 75 employees in 10 towns.
Members of the New Horizon board are Lloyd Ohlmeier of Paola, Jim Meinig of Paola, Richard Watson of Fontana, Brad Aust of La Cygne, Ernie Troth of Mound City, Steve Stainbrook of La Cygne, Ron Eastwood of Fontana, Ron Dunbar of Richmond and Gene Highberger of Westphalia. All board members were present for Tuesday’s vote.