Shermen WSC Acquisition has entered into an agreement with ED&F Man Holdings to merge with ED&F Man's bulk liquid storage and liquid animal feed supplement businesses (Westway Group).
ED&F Man is a global supplier of a broad range of commodity products, including sugar, molasses, animal feed, tropical oils, biofuels and coffee to multinational and industrial consumers.
As part of the transaction, ED&F Man will transfer the businesses to Shermen in exchange for $103 million (81.6 million) in cash and a combination of newly-issued common and convertible preferred shares of Shermen valued at approximately $165.1 million.
Following completion of the transaction, the company would have an enterprise value of $294.1 million and Shermen will be renamed Westway Group, Inc. and will be headquartered in New Orleans, Louisiana.
This transaction positions Westway to continue expanding its bulk liquid storage services.
ED&F Man's bulk liquid storage business, currently operating under the name Westway Terminals, is a global provider of storage services to manufacturers and consumers of agricultural and industrial liquids.
The business' infrastructure includes a network of 24 terminal facilities, offering total storage capacity of 284 million gallons, located at key port and terminal locations throughout the US, Western Europe and Asia.
'The merger has been in the pipeline for about a year,' Westway Terminals' Wayne Driggers, who currently manages the North American division of the bulk liquid storage business, says. 'Following share holder approval we expect the transaction to be completed by Q2 2009.'
Upon completion, Driggers will assume responsibility for managing the global bulk liquid storage business.
After closing, ED&F Man will be Westway Group, Inc.'s largest shareholder with 49.5% ownership of its common shares. ED&F Man and the Westway Group will enter into strategic agreements establishing the Westway Group as ED&F Man's preferred supplier of bulk liquid storage services globally.
Westway offers a broad range of services relating to the receipt, storage, handling and distribution of bulk liquids, which are customised to meet specific customer requirements.
Shermen is a so-called blank cheque company organised under the laws of the State of Delaware for the purpose of acquiring, through a merger, capital stock exchange, asset acquisition, stock purchase or other similar business combination, an operating business in the agriculture industry.