Cargill, CHS, ConAgra Form New Flour-Milling Venture
Food industry giants Cargill, Inc., CHS, Inc., and ConAgra Foods, Inc., announced Tuesday that they plan to combine their North American flour-milling businesses into a new multibillion-dollar joint venture called Ardent Mills.
Ardent Mills, which will serve customers in the baking and food industries, will combine ConAgra Mills and Horizon Milling, a joint venture between Cargill and CHS that was formed in 2002.
Wayzata-based Cargill, Inver Grove Heights-based CHS, and Omaha, Nebraska-based ConAgra said that they will contribute their respective milling operations to Ardent Mills on a cash-free, debt-free basis in exchange for ownership interests. Cargill and ConAgra will each own a 44 percent stake in Ardent Mills, and CHS will own a 12 percent stake. All three organizations will have representatives on Ardent Mills’ board of directors.
“Ardent Mills will set the new industry standard by addressing the most important issues facing customers, such as commodity price volatility, increasingly sophisticated food safety requirements, the need for more cost-effective supply chains, and growing market demand for more innovation in products and processes,” ConAgra Foods CEO Gary Rodkin said in a statement.
Dan Dye, president of Horizon Milling, will serve as Ardent Mills’ CEO. Meanwhile, Bill Stoufer, ConAgra Mills’ president, will be the new company’s chief operating officer.
The formation of Ardent Mills is expected to be complete late this year and is pending regulatory clearance and various closing conditions. A headquarters location for the new venture hasn’t yet been selected.
ConAgra Mills, part of ConAgra Foods’ commercial foods segment, reported $1.8 billion in sales for the fiscal year that ended in May—and Horizon Milling’s sales totaled about $2.5 billion for its fiscal year that ended that same month.
Ardent Mills’ combined operations will include 44 flour mills, three bakery mix facilities, and a specialty bakery, all located in the United States, Canada, and Puerto Rico. CHS will be one of the new company’s wheat suppliers.
“The future of flour milling is tied to serving the innovation and supply chain management challenges of food producers,” Cargill Corporate Vice President Scott Portnoy said in a statement. “This is what makes us excited about Ardent Mills. It will have the knowledge and experience to help customers develop foods that appeal to consumers’ changing taste and texture preferences, while also meeting their nutritional needs. It also will have the assets and capabilities to help customers improve the efficiency of their supply chains and strengthen their commodity risk management.”
Cargill employs 142,000 people in 65 countries. It is Minnesota’s largest private company based on revenue, which totaled $1.17 billion in its most recent fiscal year.
CHS, meanwhile, is the largest revenue-producing co-op in the nation, and it is owned by farmers, ranchers, and cooperatives across the United States. Revenue for its most recently completed fiscal year totaled $40.6 billion.