List of Deals
- 1973 acquisition of fertilizer operations of Cities Service Company; issuance of first mortgages, notes, warrants, and second mortgage notes
A coalition of French companies banded together to finance Gardinier, Inc., in 1973. Gardinier was incorporated in Florida in order to buy phosphate rock reserves from Cities Service Company. Cities Service held phosphatic fertilizer manufacturing plants in East Tampa and Fort Meade, Florida (together known as the Tampa Agricultural Chemical Operation, or TACO), as well as mines and lands in Polk, Hardee, and Manatee Counties in Florida. The TACO plants had been mining and processing the phosphate into fertilizer since 1927.
Gardinier was wholly owned by a French holding company, SOPAG International. SOPAG International was in turn owned 60 percent by Société des Participations Gardinier-SOPAG (representing the Gardinier family) and 40 percent by a group of French financial institutions including Compagnie du Nord, Crédit Lyonnais, and Banque de Suez et de L'Union des Mines. The money for Gardinier to purchase Cities Service was raised in a 1973 deal in which Gardinier issued 8.75 percent first mortgage notes for $30 million due in 1988. In that deal, Gardinier also issued second mortgage notes at 9.25 percent for $15 million due in 1983 to Cities Service. Gardinier also issued common stock worth $16 million. At that time, the TACO facilities had sales of $11.6 million, with net cash flow of $12.9 million. Sales had fluctuated widely over the previous ten years, ranging from $636,000 to $11.6 million.
The New York Times called the Gardinier family's investment in Florida phosphates "probably the most successful French investment in American resources" (Ann Crittenden, "The American Connection," New York Times, Jan. 16, 1977, p. 95). Phosphate fertilizer prices rose drastically in 1973 and pushed Gardinier's annual profits to $35 million.
The Gardinier fertilizer plants in Florida declared bankruptcy in 1985 and were purchased by Cargill. By that time, the mountains of radioactive industrial waste produced by Gardinier at the East Tampa plant had marred the firm's reputation.