Winn Cancels Deal to Buy 30% Stake in Olson Farms

An affiliate of Anaheim-based Winn Enterprises called off its tentative agreement to buy a 30% stake in Olson Farms of Sherman Oaks for $7.2 million, Olson Farms said Wednesday.

Olson Chairman John Buffington said the companies “may reopen negotiations,” but in the meantime Olson is looking for other sources of capital.

Officials of Southwest Overthrust Oil and Gas Co., the Winn affiliate, could not be reached for comment, but Buffington said in a statement that Southwest indicated that it “needed more time to evaluate and reconsider this entire transaction” for several reasons.

Among the reasons cited for Southwest’s second thoughts are a court fight over control of Olson and delays that will keep the company from voting at the Olson Aug. 23 shareholders meeting.

Another factor, Olson officials said, was probably weakness in the egg market, a key business for Olson. “The egg market has been in a downer and remains down,” said Jonathan Berge, executive vice president of Olson.

“We’ve settled all the problems,” said C. Dean Olson, a director whose family controls about 43% of the company’s stock and has been battling with other directors over the deal with Southwest.

Olson Farms is one of the nation’s largest independent producers and distributors of eggs and egg products.