Penford Completes Australia Asset Sales

The Company realized approximately $12.0 million from these sales (after estimated costs of sale). An additional $2.0 million of proceeds has been placed in escrow and may be collected as post-closing conditions are fulfilled over approximately the next 30 months.

1 Dec 2009 --- Penford Corporation has announced that on November 27, 2009, it completed sales of the operating assets of its subsidiary company, Penford Australia Ltd., including its two remaining plants. The sale of Penford’s New Zealand business was previously announced in September.

“The divestiture of the Company’s Australia and New Zealand businesses marks another important strategic action,” said Tom Malkoski, President and Chief Executive Officer. “This step will permit the realignment of our financial and human resources so that we can focus on expanding specialty products in our Food and Industrial businesses and overall returns for the Company.” Malkoski continued, “We wish to express appreciation to our former co-workers at Penford Australia for their commitment and dedication in managing the business and in helping to conclude a successful transition to new ownership.”

The Company realized approximately $12.0 million from these sales (after estimated costs of sale). An additional $2.0 million of proceeds has been placed in escrow and may be collected as post-closing conditions are fulfilled over approximately the next 30 months. Proceeds from the previously announced sale of the New Zealand operations totaled $4.8 million. All proceeds will be used to reduce outstanding debt.

Penford also expects to receive payments for selected inventory items and it continues to wind-down outstanding receivables and payables that should provide approximately $4.0 million in additional cash over about the next six months.

Penford Corporation develops, manufactures, and markets specialty natural-based ingredient systems for numerous applications. Penford has five locations in the United States.