S&W Seed stock sprouts as board explores sale, merger options

LONGMONT — S&W Seed Co.’s (Nasdaq: SANW) stock price grew like a weed Tuesday, sprouting more than 30% on news that the struggling Longmont company is exploring its options for selling the business or merging with another entity.

“The company expects to consider a broad range of potential opportunities, including, among others, a sale of the company, a merger with another strategic partner, a recapitalization or continued execution of the company’s attractive long-term business plan,” S&W’s board of directors said on Monday afternoon. 

The consideration of strategic options comes a little less than two months after S&W, which develops seed varieties and hybrids for specialty crops, reported in a preliminary earnings release that it could operate at a $5 million loss for fiscal 2025.

S&W, which shuttered its Australian business unit last year, secured a $25 million credit line from ABL OPCO LLC, a lender that does business as Mountain Ridge Capital, in late December and repurchased 200,000 shares of its common stock from MFP Partners LP, its largest shareholder.

“S&W Seed continues to successfully execute on its long-term plan. Over the last year, S&W Seed has taken decisive actions to strengthen the company, including by divesting S&W Seed Australia subsidiary and exclusively focusing on its core U.S.-based sorghum and alfalfa operations, led by its high-margin sorghum trait portfolio with Double Team, and its investment in the VBO Camelina biofuel joint-venture with Shell, while aligning its cost structure and strengthening the company’s management and employees,” S&W chairman Alan Willits said in a prepared statement. “We continue to support all initiatives that optimize shareholder value and will consider the full range of potential strategic alternatives to ensure S&W Seed is best positioned for future success.”

The board is being assisted in its options-exploration process by financial advisor Rabobank Securities Inc. and legal counsel Cooley LLP.

“There can be no assurance that the review process will result in the company pursuing any transaction or any other strategic outcome, nor as to the form or timing of any of the foregoing,” the board said. “The board has not set a timetable for completion of this process and the company does not intend to disclose further developments unless and until it determines that further disclosure is appropriate or necessary.”

S&W Seed’s stock price was $9.39  just before 2 p.m. Tuesday, up 32.07% on the day. 

on Facebook on LinkedIn