MGP Ingredients Inc. said Friday it will stick with its current business strategy, potentially ending a feud that rattled many in the company’s hometown headquarters of Atchison.
By MARK DAVIS
The Kansas City Star
The battle, which began in May, has pitted members of the company’s founding Cray family against others on MGP’s board of directors and its chief executive officer, Tim Newkirk.
Residents have feared job losses at one of Atchison’s largest employers after MGP announced in late May that it was reviewing its strategic options. Such reviews often lead to a merger or sale of a company or part of its operations.
Atchison residents, many of whom own MGP stock, rallied around the Cray family. The Crays, who have a big ownership stake in the company, have been among the city’s philanthropic leaders for decades.
Friday’s announcement from the company said it would remain focused on its current businesses.
“After a thorough review, it became clear that the best path to create value for shareholders was to build momentum with MGP’s current strategy,” chairman John Speirs said in the announcement.
MGP mostly produces beverage alcohols and specialty food ingredients. Formerly known as Midwest Grain Products, it was founded in Atchison in 1941 by Cloud L. Cray Sr. His son, Bud Cray, serves on the board along with Karen Seaberg, who is Bud Cray’s daughter.
Six other directors and company management have battled the two family board members throughout the summer and the fall. The fight has twice blocked a scheduled shareholders meeting as each side sought support from investors in what Wall Street calls a proxy battle.
Last month, both sides said they were working on settling their differences. The decision to press forward with the current strategy resolved their key point of contention.
“This was the crux of the entire proxy battle,” Seaberg said Friday.
MGP shares fell 1 cent Friday and closed at $5.16 before the announcement.
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