Del Monte to buy Agway Country Products division

<p>A federal bankruptcy judge on Monday approved the sale of Agway Inc.s Country Products Group to Del Monte Fresh Produce Co. for $12.15 million.</p><p>The Coral Gables, Fla.-based food company outbid AMPCO Distribution Services LLC of Long Island, said Agway spokesman Stephen Hoefer. AMPCO had reached a previous tentative agreement with Agway to purchase its food division for $8.3 million.</p><p>Country Best Produce and Country Best Adams make up Agways Country Products Group, which repackages, ships and sells potatoes, onions and other produce to large chain-store customers in the eastern United States.</p><p>Agway will realize net proceeds from the sale of about $11.2 million, Hoefer said.</p><p>The DeWitt-based agricultural cooperative must place approximately $658,000 in escrow for possible severance and indemnity payments, money which it may or may not have to pay out. It also must pay another $300,000 to AMPCO as compensation for the expenses that company incurred as part of the bidding process, Hoefer said.</p><p>The sale is scheduled for closing next Monday.</p><p>The Country Products Group employs 223 people in Syracuse, Atlanta and Florida. The fate of those workers is up to Del Monte, Hoefer said. Del Monte officials had no immediate comment about the acquisition or its plans for workers.</p><p>Another auction to sell Agway Energy is set for Thursday in Utica. Agway has an agreement with Suburban Propane LLP, which has agreed to pay $206 million. There is a termination payment of more than $8 million if Suburban Propane isnt the successful bidder, which includes a $5 million breakup fee and the rest for expense reimbursement. Offers must be in $500,000 bid increments.</p><p>Taking over Agways pension plan isnt part of the sale agreement with Suburban Propane, a factor the court may consider when considering other bids.</p><p>If that sale goes through, Agway expects to net about $175 million from the deal.</p><p>Although Agway signed agreements for the sale of these two divisions, auctions seeking higher or better offers are required by bankruptcy law.</p><p>Agway filed for Chapter 11 bankruptcy protection in October 2002. It is owned by 69,000 farmer-members in the Northeast and provides fuel, equipment and service to more than 500,000 customers in homes, farms and businesses throughout Pennsylvania, New Jersey, New York and Vermont. Agway Energy was not part of the bankruptcy filing.</p><p>Del Monte is a leading producer and marketer of high quality fresh and fresh-cut produce to more than 50 countries around the world.</p><p>_____</p><p>On the Web:</p><p>Agway: www.agway.com</p><p>Del Monte: www.freshdelmonte.com</p>

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