Milling & Baking News - July 20, 2004 - 9

B U S I N E S S

MGPI and Cargill agree to jointly
produce and market Fibersym HA
ATCHISON, KAS. - MGP Ingredients,
Inc. and Cargill, Inc. have announced a
business alliance for the production and
marketing of Fibersym HA, a resistant
starch derived from high amylose corn.
Terms of the business alliance, which
has an initial term of five years, call for
Cargill to manufacture Fibersym according to a patent licensed exclusively
to MGPI and relating to the production
of food-grade starch resistant to alphaamylase.
Until mid-June, MGPI called Fibersym
by the name of Fiberstar (see Milling &
Baking News June 29, Page 9).
Both companies will market the resistant starch in the coming months with
the Fibersym brand name. MGPI will
recognize all revenue from such sales,
but MGPI and Cargill will share profits
from those sales.

"This alliance provides great opportunities for both companies, as well as food
manufacturers seeking a broader base of
resistant starches for use in
lower net carb applications,"
said Mike Trautschold,
executive vice president of
marketing and sales at MGPI.
"The arrangement combines MGPI's
licensed patented technology with Cargill's diverse production capabilities.
R. Creager Simpson, president of
Cargill Food & Pharma Specialties
said, "With increasing concerns about
health and wellness, market interest in
ingredients like Fibersym HA is growing
because consumers are seeking products
that are higher in fiber and lower in net
carbs. Fibersym HA, when combined
with Cargill's other functional ingredients, creates more options for food

companies to enhance their lower net
carb product development.
"This new resistant starch broadens
Cargill's existing lines of health-promoting ingredients such as ActiStar, a resistant maltodextrin, Oliggo-Fiber inulin
and our broad lines of polyols
and soy protein products,"
Mr. Simpson said.
By the end of 2004,
Cargill said it plans to
begin producing and marketing tapioca-based resistant starches
for use in food products. An exclusive,
royalty-bearing sublicense based on the
patent licensed exclusively to MGPI
made the expansion possible.
The new business alliance also gives
Cargill the opportunity to participate with
MGPI in future product innovations from
corn and certain other plant sources.
The arrangements between MGPI and
Cargill are subject to termination if the
two companies determine the products
are commercially unviable, they said. MBN

Chicago-based equity investment firm
purchases sandwich maker Pierre Foods
CINCINNATI - PF Management, Inc., the
sole owner of Pierre Foods, Inc., has sold
the baked foods and sandwich producer to
an affiliate of Madison Dearborn Partners,
a Chicago-based private equity investor, for
an undisclosed amount.
A maker of fully-cooked sandwiches and
baked foods for the food service, vending
and warehouse club sectors, Cincinnati-

based Pierre has annual revenue of about
$360 million and 1,700 employes. Founded
in 1946, the company operates production
facilities in Cincinnati and Claremont, N.C.
Bank of America and Wachovia Bank provided debt financing to MDP for the transaction, which will retain Pierre's existing management team, including chief executive Norbert E. Woodhams and senior vice-president

Archer Daniels to boost capacity at four
North American oilseed processing plants
DECATUR, ILL. - Archer Daniels Midland
will expand production capacity at four of
its oilseed processing plants in North America as part of what the company termed an
"ongoing rationalization strategy."
ADM, which operates 18 oilseed processing plants across the United States, said
it will expand capacity at key facilities in
Mankato, Minn.; Des Moines, Iowa; Lin-

coln, Neb.; and Enderlin, N.D.
ADM mothballed some capacity from
late 2002 through early this year as profit
margins for soybean processing decreased.
ADM idled production capacity at six U.S.
plants in late 2002 and closed its North Kansas City, Mo., plant in July 2003.
However, small domestic soybean supplies have limited supplies necessary to

Labor Department sues bakery workers' union
over alleged misuse of death benefit funds
PITTSBURGH - A lawsuit filed by the
U.S. Department of Labor alleges that the
daughter of a retired bakery workers' union
president misused union funds earmarked
for worker death benefits.
Filed in the U.S. District Court for Western
Pennsylvania against Local 12 of the Bakery,
Confectionery, Tobacco Workers and Grain
Millers union, the suit claims Marilyn Conbakingbusiness.com / world-grain.com

stable, an employe of the benefit plan since
1986, took funds for personal use from a
$350,000 plan covering 265 participants, the
Associated Press reported.
Ms. Constable unlawfully assumed control of the plan, the filing said, and began
withdrawing money for personal use five
years ago. The suit also alleges four of the
plan's trustees failed to perform their duties.

of sales and marketing Robert C. Naylor.
"We believe that Pierre is very well positioned for growth and has an excellent management team," said Rob Selati, a managing
director of Madison Dearborn, which manages about $8 billion in equity capital. "We
look forward to playing a supportive role in
the company's future development."
With a product line exceeding 800 stockkeeping units, Pierre serves restaurant
chains, schools, convenience stores, longterm health care facilities and the military. MBN

make livestock feed and vegetable oil. As
a result, prices for those end products have
risen, helping crush margins rebound.
Karla Miller, a spokeswoman with ADM,
said the North Kansas City plant and facilities in Little Rock, Ark., and Fredonia, Kas.,
will remain closed.
Company officials also said ADM's overall U.S. oilseed processing capacity of about
1.7 million bushels per day won't change
with the capacity expansion, which should
conclude by September. MBN

"Bills for the plan are not being paid, beneficiaries' claims are not being processed and
checks made out to the plan are not being
deposited," the D.O.L. said. "A group life insurance policy is in arrears and will be terminated if payment is not received by July 29."
The plan covered workers at several western Pennsylvania bakeries, including a former Nabisco plant in Pittsburgh. Bake-Line
Group, L.L.C., operated that plant until filing
for Chapter 7 bankruptcy liquidation earlier
this year. (See related story on Page 11.) MBN
Milling & Baking News, July 20, 2004 / 9

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Milling & Baking News - July 20, 2004

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