AgriBioTech agrees to second big asset sale deal

Wednesday, June 7, 2000 | 11:01 a.m.

AgriBioTech Inc., the bankrupt turfgrass and forage seed producer based in Henderson, has signed a tentative agreement to sell its forage assets to a Missouri company.

Coupled with the May 21 sale of its turfgrass seed division to J.R. Simplot Co. of Boise, Idaho, AgriBioTech will have just a few remaining real estate and technology assets to be disposed of at liquidation.

The sale announced today, to Research Seeds Inc., St. Joseph, Mo., the largest alfalfa seed company in the world, is for $16 million cash. AgriBioTech issued a statement today saying the sale, along with the disposition of the other forage-related assets retained by the company, is expected to create a value of about $30 million for AgriBioTech. The Henderson company is retaining some accounts receivable.

Ken Fearday, who was appointed president of Research Seeds last month, said today that none of the assets his company is acquiring from AgriBioTech are in Nevada and that his company would maintain no presence in the state.

AgriBioTech, which struggled to consolidate nearly three dozen acquisitions over six years, filed for Chapter 11 bankruptcy in January.

Development Specialists Inc., a Chicago-based crisis management company, took over day-to-day operations in February and placed William A. Brandt in charge of disposing of company assets in accordance with bankruptcy procedures.

The plan to sell the company's turfgrass seed assets to Simplot, one of the nation's largest agriculture companies and a major potato supplier to fast-food chains, was announced in early May.

Bradley Sharp of Development Specialists Inc., speaking on behalf of AgriBioTech, said the sale of the division to Simplot, for $65 million, was finalized about two weeks later. A Simplot spokesman at that time said the company's bid for the division was substantially less than the figure quoted by AgriBioTech, but Sharp said today the amount was accurate.

A spokesman for Simplot could not be reached for comment this morning.

The sales to Simplot and Research Seeds are expected to be finalized at a series of hearings before Judge Linda Riegle in U.S. Bankruptcy Court in Las Vegas July 10-12.

Sharp said there is no timetable for the disposition of other AgriBioTech assets. AgriBioTech, which had 1,000 employees nationwide in December, now has about 600, he said.