ATCHISON, Kan. — Two members of MGP Ingredients’ board of directors are calling for the removal of MGPI President and Chief Executive Officer Tim Newkirk, citing the company’s lack of profitable growth and an effort to sell part of the business.

In response, the longtime Atchison company announced a “review of strategic alternatives” and adjourned its annual shareholders meeting without conducting any business.

A document was filed with the Securities and Exchange Commission by Karen Seaberg and Cloud Cray Jr. The document states, “The reporting persons (Seaberg and Cray) have had growing concern with the lack of profitable growth, deterioration in the corporate culture, efforts to sell certain parts of the company’s business, efforts to amend the bylaws that would limit accountability to shareholders and increase the power of the CEO, and the level of compensation paid to the Chairman of the board of directors and the CEO of the company.”

Prior to MGPI’s annual stockholders meeting – scheduled for May 23 – Seaberg and Cray revoked proxies they had previously given in favor of the matters to be voted at the meeting. As a result, there was not a quorum and therefore no business could be conducted at the meeting, which was adjourned to a later date.

In a May 29 press release, MGPI announced the board of directors “has authorized a review of strategic alternatives” and “established a Special Committee of six independent directors to conduct the review.” The company said it is repositioning its assets and product offerings into higher margin products and away from raw material that are subject to price volatility.

MGPI also stated that a definitive timetable for completion of its evaluation has not been set, thus there can be no assurances that the process will result in any transaction being announced or completed.

MGP Ingredients makes specialty wheat proteins and starches for food and nonfood applications, as well as distillery products such as food-grade alcohol.

The company’s stock closed Wednesday at $5.30 a share, down 2 percent for the day and 10 percent from its 52-week high. Cloud L. Cray Sr. founded the company in 1941. Ms. Seaberg is the daughter of Cloud Cray Jr., a longtime executive with the company.

(0) comments

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.