With the summer already two-thirds over and the dog days of August about to seep in, I’ll bet you didn’t notice that…
About the time troubled New York lender CIT Group started coughing up blood two weeks ago, a trustee for one of its former clients, Meadowbrook Farms Cooperative, was alerting a federal bankruptcy judge in East St. Louis, Ill., of an offer to dump most of the busted Illinois pork packer.
Recall that Meadowbrook took the Chapter 7 swim in mid-March, pulling nearly 200 Midwestern hog farmers underwater with it.
At the time, it listed $28 million in assets and $44 million in red ink; $6 million of it owed to CIT.
On July 10 the Meadowbrook’s bankruptcy trustee filed notice that she intends to sell “certain of the Debtor’s real estate” — the land and kill plant near Rantoul, Ill. — and much of the coop’s “machinery, equipment, and fixtures” for nearly $14.9 million.
The buyer is the bank , Stearns Bank, N.A., St. Cloud, Minn., that Meadowbrook owes — surprise! — $14,862,536.78.
So while Stearns gets a slightly used Illinois pork plant and Meadowbrook sees its largest asset dropped from its unbalanced balance sheet, CIT and the co-op’s members will get a fat thumb in their eyes.
(You can read earlier columns on Meadowbrook’s collapse.)
‘The Informant’
Another story you might have missed was Greg Burns’ July 16, Chicago Tribune column on The Informant, the about-to-be released, Hollywood movie on the 1990s price-fixing scandal at Archer Daniels Midland.
Scheduled for general distribution Oct. 9, the movie, centering on ADM wonderboy-turned-FBI mole Mark Whitacre, features mega-star Matt Damon in the lead role.
The movie trailer — viewable on Web but, interestingly, best at Mark Whitacre’s personal Web site, www.markwhitacre.com/ — has a cartoonish story line (black comedy, claims Tinsel Town buzz) about a bumbling informant who, despite himself, giftwraps and hands the FBI its biggest corporate criminal ever.
Whitacre, recall, later went to prison after admitting the embezzlement of millions from the ag processor even as he was audio and video taping the price fixers at work.
My reaction
Reached by telephone July 22, Whitacre noted that both he and wife Ginger recently screened the completed film and “both thought it very entertaining.”
My view, based on the movie trailer only, is less generous. I don’t remember anything remotely comical or entertaining about those dark days and months as the ADM story evolved.
Every week brought new revelations from government, industry and company sources, most of whom refused to go on the record. Between them, truth seemed to be a work in progress. It still is.
For proof go to Whitacre’s Web site and view, back-to-back, both the movie trailer and the video excerpt from the Discovery Channel’s film on Whitacre. Two more stark pictures of one man never existed.
70% debt on dairies
Stark, too, is a fact I buried in last week’s column on the crack-up in dairy. That fact, that 70 percent of all U.S. dairy farms have debt — likely the most highly leveraged sector in American agriculture — came courtesy of July 14 House Ag Committee testimony by James Miller, USDA’s under secretary of farm and foreign ag service.
Miller went on to say that “(a)cross all sectors in agriculture, dairy ranks third in the average debt-to-asset ratio, behind poultry and hogs.”
Holy cow, the three enterprises that every farm family, especially the overworked farm wife, depended on to deliver cash income year-in, year-out — egg and butter money, “mortgage lifters” hogs — for a century are now the three most indebted in all of agriculture?
And folks wonder if in our never-ending pursuit of efficiency — and, in the case of Meadowbrook and ADM, profit — we’ve lost our soul.
Heart and soul is more like it.
Dear Mr. Guebert:
I just wanted to say that I found your article about Mark Whitacre to be excellent. You contrast the real Mark Whitacre as portrayed on the Discovery Channel (and where the FBI now calls him a national hero) with the Mark Whitacre as portrayed in the upcoming film.
I thought you and your readers may be interested to know that I wrote the complete biography (authorized) of Whitacre. The book was just launched yesterday and is entitled MARK WHITACRE AGAINST ALL ODDS. The URL for my book is http://www.markwhitacreagainstallodds.com, where you can read an excerpt and order copies if you so desire. The most impressive aspects about Mark and Ginger Whitacre are: (1) how Ginger held them together through faith in God and sheer determination while he was down for almost a decade, and (2) how completely and unequivocally he takes responsibility for what he did wrong, leaving it to others to decide whether what he did right has any merit. He is all about accepting responsibility, and I believe my book conveys that in a readable manner. Thanks again for your nuanced remarks above.
Sincerely, Floyd Perry