(Nov. 20) SAXONBURG, Pa. — The new owner of one of the largest producers of fresh mushrooms and spawn, or seed, says it bought Sylvan Inc., Saxonburg, to save the company.

Snyder Associated Cos.Inc., a Kittanning-based holding company, offered $12.25 per share, or $63 million. With Snyder assuming Sylvan’s $32 million debt, the agreement, if approved by shareholders, would be a $95 million deal, said Chuck Cohen, a spokesman for Snyder.

“The Snyders got concerned, as other growers have gotten concerned, by the fractiousness within the board of Sylvan,” he said.

“You know how dependent the grower is on having a stable and reliable spawn supplier. They were concerned that Sylvan’s own performance could be adversely affected because there was dissention at the board level.”

Sylvan was put up for sale last year.

Sylvan chairman and chief executive Dennis Zensen and chief financial officer Donald Smith; Roger Claypoole, president of WWF Mushrooms, the general partner of Worthington-based grower-shipper Creekside Mushrooms Ltd.; and Curtis Jurgensmeyer, CEO of J-M Farms Inc., Miami, Okla., formed an industry group that offered to buy the company for $11 per share. Then came a proxy fight, Cohen said.

Snyder is a Creekside co-owner.

“It was really from Snyder’s perspective as a customer that they took an interest in the company and decided that they should buy this thing and stabilize it. That’s how it started,” Cohen said.

Sylvan was close to making a deal with a Midwesternbuyout group in October, Cohen said. The deal fell through after the group came up short on its financing and approached the Snyders to join them in buying Sylvan.

Sylvan owns Quincy Farms, a large Quincy, Fla., fresh mushroom growing farm. Modern Mushroom Sales Co., Avondale, markets the 25 million pounds of fresh mushroomsthe operation produces a year.

Sylvan has nearly $30 million a year in fresh mushroom sales that account for 75% of the firm’s net sales.

Sylvan reported that its net income dropped 19% last year. On Nov. 12 Sylvan said its third-quarter net income declined 24% to $839,000, or 16 cents per share, from last year’s $1.1 million, or 20 cents a share.

Consolidated operating income for the quarter fell 26%, reflecting an 11% decline in operating income from its spawn business and a 35% increase in unallocated corporate expenses, the company reported. Despite the declines in spawn, the company saw a 12% increase in operating income from its fresh mushroom segment.

Sylvan chairman and CEO Dennis Zensen and other managers, who own 15% of the firm’s shares, are expected to hold an equity stake in the new ownership, Sylvan said.

Snyder has no plans for its new company other than to empower the incumbent management and to support them in operating and growing the fresh and spawn mushroom business, Cohen said.

A diversified company, Snyder owns oil, natural gas, sand and gravel, mineral and mushroom concerns.

Italian investor Angelo Sartor also was reported in August 2002 to be considering buying Sylvan for cash.