Steffes Group


Crystal Sugar Unit Retains Demonstrate Flexibility in Auctioning Non-Traditional Assets

While Steffes is best known for auctions of land and equipment, almost any asset can be sold at auction. And one auction closing Wednesday, June 27, features an asset that is rarely offered for sale outside members of agricultural co-ops.

The auction features Unit Retains for a large partner in the American Crystal Sugar Company. The retains entitle the buyer to upcoming payouts of retained revenues held by the co-op.

“One of the producers of the co-op is in bankruptcy, and its assets include a series of payouts totaling more than $720,000 over five years, starting in 2019,” said Steffes representative Ashley Huhn. “By selling these now, the court will be able to realize the assets and move toward a resolution of the bankruptcy,” he said.

Each year, the co-op retains funds to provide operating capital. The funds for each year remain with the co-op for seven years, and after that they are paid back to the producer.

“In effect, what you have is an entitlement to specific future payments – not unlike the future payments of bonds that are traded on the secondary market. But these assets are ordinarily offered only to other members of the co-op. In this case, anybody can invest in them,” said Huhn.

The retains are being sold in 12 lots – the biggest being for more than $94,000.

“The payments are not guaranteed, but the funds have always been paid out,” said Huhn.

He said he enjoys the challenge of offering assets not traditionally sold at auction. “As far as I know, such retains have never been sold at auction, so we had to work out the details from scratch. It’s very satisfying not only to take on a challenge like that, but also to help provide more liquidity to an asset, which was needed in this case,” he said.

Individuals with assets to sell – whether land, machines or financial assets, may call Ashley Huhn at Steffes Group, 701.238.1975.

Crystal Sugar Unit Retains Auction