Land O’Lakes Inc. has sold its Missouri egg division for an undisclosed price, part of a continuing divestiture of the company’s egg business, which had been one of the nation’s largest.
Arden Hills-based Land O’Lakes has also recently sold its California egg operations, meaning that the majority of the divestment is complete. The agribusiness cooperative still has egg operations in Maine and Connecticut, which it appears to be trying to sell.
The buyer for Land O’Lakes’ Missouri and Colorado egg businesses is Opal Foods, a new company formed by California-based private equity group AGR Partners and two egg producers, Indiana-based Rose Acre Farms and Ohio-based Weaver Brothers.
With the deal, plus the construction of a new cage-free egg farm in Missouri, Opal Foods will have over $200 million in annual revenue, AGR Partners said on its website.
Rose Acre is the second-largest U.S. egg producer with over 24 million hens, while Weaver Brothers is ninth, according to Egg Industry Magazine. Land O’Lakes, through its Moark subsidiary, was the third-largest egg operator with 16.1 million hens at the end of 2013.
But the company decided late last year to sell much of its egg business, which made up a single-digit percentage of Land O’Lakes $14.2 billion in 2013 sales. Moark had been losing money for the past three years.
Plus, the egg business has become increasingly fraught with uncertainty over animal-rights issues. California, often a bellwether state, will require egg producers there — as well as producers that sell into the California market — to significantly increase cage space for hens.