USA: Proximity Malt starts production at second of two new 25,000 t malthouses

Proximity Malt, a startup company from Milwaukee, WI plans to ship by Christmas its first malt from its new malthouse in Laurel, Delaware. The company bought in December 2015 for $950,000 the premises of former Laurel Grain Co.'s complex consisting inter alia of an ageing grain elevator, which had been abandoned for several years, and several concrete silos. In the meantime the company has restored the facility and has built a new 25,000 tons malthouse.

The company plans to produce base and specialty malts from barley, wheat and other grains to supply the local craft brewing industry.

In the second quarter of 2017 Proximity Malt already commissioned a second malthouse of the same size in Monte Vista, Colorado. The Colorado site was converted from an old starch plant. Both sites were selected because of their proximity to areas with a stable barley production.

In addition the startup company converted an old plating factory into a collaboration center at the company’s headquarters in Milwaukee, WI. At the beginning of this year the company inaugurated the new site, which combines under one roof offices, production lab, a pilot malting with a small roasting capability to mimic the full scale plants and a retail location for craft brewers.

Proximity Malt was founded in 2015 by Dale West and Dale Bugajski, twoformer executives of Malteurop North America, and Steve Furcich, partner in Tillridge Global Agribusiness Partners. Tillridge, an agribusiness private equity firm based in Irving, Texas, is an affiliate of NGP Energy Capital Management, which provided a private equity financing with $60 million of funding commitments for Proximity Malt through its affiliate NGP Global Agribusiness Partners.

Dale West, who serves as CEO of Proximity Malt, worked more than 24 years for Malteuropbefore leaving the company in July 2014. The other partner, Dale Bugajski, assumes the role as CFOof Proximity Malt and had also more than 5 years of work experience with Malteurope before he left in March 2015. The two werejoined in October 2015 by Amy Germershausen, who also worked more than 24 years with Malteurope and who assumes the role as Vice President Sales and Marketing.

In a law suit filed Dec. 17, 2015 in the Milwaukee County Circuit Court, Malteurop North America claims that former employees now being engaged in the new company began planning their new venture while still employed at Malteurop. The American arm of the French malting company also claims that confidential documents were copied. "Without Malteurop's knowledge or consent, an external hard drive was connected to Germershausen's Malteurop computer and approximately 9,900 documents were copied," the complaint states.

Malteurop alleged that the three former employees acted in concert to "misappropriate Malteurop's trade secrets." In a statement from December 2015 Proximity said it "denies all claims made by Malteurop North America Inc. and will vigorously defend itself, including filing counterclaims against Malteurop North America Inc. where appropriate."

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