Today U.S. Sugar announced that its board of directors had approved the sale/leaseback of 180,000 acres to the South Florida Water Management District for $1.34 billion ($7,444 per acre). The transaction ranks as one of the largest of 2008 and is the culmination of intense negotiations between the privately held company and the water district that will create a natural flow of water between Lake Okeechobee and the southern Everglades. The complete press release from U.S. Sugar follows..
Clewiston, FL – December 8, 2008 – U.S. Sugar Corporation announced that its Board of Directors today approved the contract to sell approximately 180,000 acres of its real estate assets to the South Florida Water Management District.
“After many months of negotiations and careful deliberation, the U.S. Sugar Board of Directors has approved the contract to sell its real estate assets to the South Florida Water Management District for $1.34 billion and retain the right to lease the property for seven crops,” said Robert Coker, senior vice president, public affairs.
“The terms of the deal have been approved today by our Board and the contract has been signed and delivered to the South Florida Water Management District,” Coker said.
“This is a milestone in this historic transaction,” Coker said, “and one that we hope will provide certainty to many of the stakeholders. We are hopeful that the Governing Board of the South Florida Water Management District will take up and approve the contract early next week, bringing Governor Crist’s bold plans for Everglades restoration to fruition.”
In accordance with Delaware law, BMO Capital Markets will have a period of two months to shop the Company and give other interested purchasers a chance to make a better offer. This includes the Lawrence Group, which has not made a formal offer, but has indicated interest in the company through an aggressive media campaign.
Also approved by the U.S. Sugar Board today was a comprehensive severance package for both hourly and salaried employees. The package provides one year’s salary for all hourly employees and two years’ salary for all salaried employees – to be paid if the Company is forced to shut down at the end of seven crops.
Coker said, “Hopefully this safety net will not be needed.”