TOMBALL, TEXAS — RiceBran Technologies, a developer and manufacturer of nutritional and functional ingredients derived from rice and other small and ancient grains for human food, nutraceutical, pet care and equine feed applications, is partnering with food industry consulting firm Gander Foods, LLC. Gander Foods was founded by Steven Weinreb, former president and chief executive officer of American Rice Inc. and current president of Concord Foods, a rice and specialty food marketing company.
Under terms of the agreement, Lakewood, NJ-based Gander Foods has engaged JT Ferguson, owner and operator of Cormier Rice, to provide management services to RiceBran’s Golden Ridge Rice Mills facility in Wynne, Ark., which will enable RiceBran to expand its focus on value-added ingredient opportunities. RiceBran acquired the assets and operations of Golden Ridge Rice Mill in November 2018.
RiceBran said the partnership places sourcing, selling and operations of Golden Ridge in the hands of a local expert. In addition, the company expects to see rapid improvement in Golden Ridge’s adjusted EBITDA contribution. Another benefit is the expected purchase of RiceBran equity by Gander Foods, a move that would align it with RiceBran’s shareholders.
As part of the agreement, Mr. Ferguson will oversee the day-to-day operations for Golden Ridge. Mr. Ferguson is a third-generation rice miller and brings an extensive network of local farmers for sourcing grain for the mill, with a proven track record of operating Cormier Rice.
“We have significantly improved operations at Golden Ridge over the past 18 months, driving an expected 30% to 40% increase in revenue in 2022 vs. 2021, following similar gains in 2021 vs. 2020,” said Peter Bradley, executive chairman of RiceBran. “This progress was the result of higher volumes, increased efficiencies, and higher milling yields. While these improvements have significantly reduced adjusted EBITDA losses for the mill, overall results have been constrained by our processes for sourcing and selling rice.
“We expect rapid improvement in profitability at Golden Ridge from Mr. Ferguson’s ability to implement the successful Cormier business model for grain sourcing and finished rice sales, and under Mr. Ferguson’s guidance, Golden Ridge should be able to achieve further operating improvements. With these improvements, we believe there is an opportunity to expand the mill’s production schedule from its current 5 days per week to 6 or 7 days per week, further increasing Golden Ridge’s revenue and adjusted EBITDA.”In exchange for Gander Foods’ services, RiceBran said it will pay Gander Foods an initial one-time fee. Gander Foods has agreed to use this payment to purchase unvested RiceBran common stock, which will vest in equal installments over three years, subject to Gander Foods’ continuous service to Golden Ridge, the company said. Subsequently, Gander Foods will receive quarterly performance payments based on a percentage of Golden Ridge’s positive adjusted EBITDA contribution and is expected to use these payments to purchase additional RiceBran common stock.