INVESTMENTS IN JOINT VENTURES	9 Months Ended
Feb. 23, 2020
INVESTMENTS IN JOINT VENTURES
INVESTMENTS IN JOINT VENTURES	8. INVESTMENTS IN JOINT VENTURES We hold a 50% ownership interest in Lamb-Weston/Meijer v.o.f. (“Lamb-Weston/Meijer”), a joint venture with Meijer Frozen Foods B.V., which is headquartered in the Netherlands and manufactures and sells frozen potato products principally in Europe. We also hold a 50% interest in Lamb-Weston/RDO Frozen (“Lamb Weston RDO”), a potato processing venture based in the United States. These investments are accounted for using equity method accounting. On October 15, 2019, we acquired a 50% ownership interest in Lamb Weston Alimentos Modernos S.A. (“LWAMSA”), a joint venture with Sociedad Commercial del Plata, which is headquartered in Argentina, for $27.3 million. During the thirty-nine weeks ended February 23, 2020, we paid $22.6 million and will pay the remaining $4.7 million, less any amounts for indemnified losses, in October 2024. LWAMSA manufactures and sells frozen potato products principally in South America. We account for the investment using equity method accounting. The carrying value of our equity method investments, which includes Lamb-Weston/Meijer, Lamb Weston RDO, and LWAMSA at February 23, 2020 and May 26, 2019, was $253.4 million and $224.6 million, respectively, and are included in “Equity method investments” on our Consolidated Balance Sheets. For the thirteen weeks ended February 23, 2020 and February 24, 2019, we had sales to our equity method investments of $8.6 million and $5.8 million and payments to our equity method investments of $1.9 million and $1.5 million, respectively; and for the thirty-nine weeks ended February 23, 2020 and February 24, 2019, we had sales to our equity method investments of $25.1 million and $19.9 million and payments to our equity method investments of $7.9 million and $7.4 million, respectively. Total dividends from our equity method investments were $10.9 million and $9.8 million for the thirteen weeks ended February 23, 2020 and February 24, 2019, respectively; and $28.9 million and $35.4 million for the thirty-nine weeks ended February 23, 2020 and February 24, 2019, respectively. The thirteen and thirty-nine weeks ended February 23, 2020, both include a $2.6 million loss related to the withdrawal from a multiemployer pension plan by Lamb Weston RDO. During the thirteen weeks ended February 23, 2020, we entered into an agreement with Lamb-Weston/Meijer, effective as of December 31, 2018, to share the costs of a single, global enterprise resource planning (“ERP”) platform and related software and services. Under the terms of the agreement, Lamb-Weston/Meijer will pay us in five equal annual payments, plus interest, beginning in the period the system is deployed at Lamb-Weston/Meijer. In connection with this agreement, we recorded a $6.0 million receivable from Lamb-Weston/Meijer in “Other assets” on our Consolidated Balance Sheet as of February 23, 2020. We expect the receivable to increase as development and implementation of the ERP progresses over the next year. Variable Interest Entity - Consolidated In November 2018, we entered into an agreement to acquire the remaining 50.01% interest in Lamb Weston BSW. Our Consolidated Statements of Earnings includes 100% of Lamb Weston BSW’s earnings beginning November 2, 2018. Prior to entering into the agreement, Lamb Weston BSW was considered a variable interest entity, and we determined that we were the primary beneficiary of the entity. Accordingly, we consolidated the financial statements of Lamb Weston BSW and deducted 50.01% of the operating results of the noncontrolling interests to arrive at “Net income attributable to Lamb Weston Holdings, Inc.” in our Consolidated Statements of Earnings. Lamb Weston and Lamb Weston BSW purchase potatoes and utilize storage facilities and water treatment services from a shareholder of Ochoa, our former partner of the Lamb Weston BSW joint venture. While we continue to purchase such goods and services, subsequent to November 2, 2018, the shareholder of Ochoa is no longer considered a related party. For the period up to November 2, 2018, the aggregate amounts of potato purchases were $24.6 million for the thirty-nine weeks ended February 24, 2019. The aggregate amount of storage facilities and water treatment service costs were $2.5 million for the thirty-nine weeks ended February 24, 2019.

INVESTMENTS IN JOINT VENTURES

9 Months Ended

Feb. 23, 2020

8. INVESTMENTS IN JOINT VENTURES

We hold a 50% ownership interest in Lamb-Weston/Meijer v.o.f. (“Lamb-Weston/Meijer”), a joint venture with Meijer Frozen Foods B.V., which is headquartered in the Netherlands and manufactures and sells frozen potato products principally in Europe. We also hold a 50% interest in Lamb-Weston/RDO Frozen (“Lamb Weston RDO”), a potato processing venture based in the United States. These investments are accounted for using equity method accounting.

On October 15, 2019, we acquired a 50% ownership interest in Lamb Weston Alimentos Modernos S.A. (“LWAMSA”), a joint venture with Sociedad Commercial del Plata, which is headquartered in Argentina, for $27.3 million. During the thirty-nine weeks ended February 23, 2020, we paid $22.6 million and will pay the remaining $4.7 million, less any amounts for indemnified losses, in October 2024. LWAMSA manufactures and sells frozen potato products principally in South America. We account for the investment using equity method accounting.

The carrying value of our equity method investments, which includes Lamb-Weston/Meijer, Lamb Weston RDO, and LWAMSA at February 23, 2020 and May 26, 2019, was $253.4 million and $224.6 million, respectively, and are included in “Equity method investments” on our Consolidated Balance Sheets. For the thirteen weeks ended February 23, 2020 and February 24, 2019, we had sales to our equity method investments of $8.6 million and $5.8 million and payments to our equity method investments of $1.9 million and $1.5 million, respectively; and for the thirty-nine weeks ended February 23, 2020 and February 24, 2019, we had sales to our equity method investments of $25.1 million and $19.9 million and payments to our equity method investments of $7.9 million and $7.4 million, respectively. Total dividends from our equity method investments were $10.9 million and $9.8 million for the thirteen weeks ended February 23, 2020 and February 24, 2019, respectively; and $28.9 million and $35.4 million for the thirty-nine weeks ended February 23, 2020 and February 24, 2019, respectively. The thirteen and thirty-nine weeks ended February 23, 2020, both include a $2.6 million loss related to the withdrawal from a multiemployer pension plan by Lamb Weston RDO.

During the thirteen weeks ended February 23, 2020, we entered into an agreement with Lamb-Weston/Meijer, effective as of December 31, 2018, to share the costs of a single, global enterprise resource planning (“ERP”) platform and related software and services. Under the terms of the agreement, Lamb-Weston/Meijer will pay us in five equal annual payments, plus interest, beginning in the period the system is deployed at Lamb-Weston/Meijer. In connection with this agreement, we recorded a $6.0 million receivable from Lamb-Weston/Meijer in “Other assets” on our Consolidated Balance Sheet as of February 23, 2020. We expect the receivable to increase as development and implementation of the ERP progresses over the next year.

Variable Interest Entity - Consolidated

In November 2018, we entered into an agreement to acquire the remaining 50.01% interest in Lamb Weston BSW. Our Consolidated Statements of Earnings includes 100% of Lamb Weston BSW’s earnings beginning November 2, 2018. Prior to entering into the agreement, Lamb Weston BSW was considered a variable interest entity, and we determined that we were the primary beneficiary of the entity. Accordingly, we consolidated the financial statements of Lamb Weston BSW and deducted 50.01% of the operating results of the noncontrolling interests to arrive at “Net income attributable to Lamb Weston Holdings, Inc.” in our Consolidated Statements of Earnings.

Lamb Weston and Lamb Weston BSW purchase potatoes and utilize storage facilities and water treatment services from a shareholder of Ochoa, our former partner of the Lamb Weston BSW joint venture. While we continue to purchase such goods and services, subsequent to November 2, 2018, the shareholder of Ochoa is no longer considered a related party. For the period up to November 2, 2018, the aggregate amounts of potato purchases were $24.6 million for the thirty-nine weeks ended February 24, 2019. The aggregate amount of storage facilities and water treatment service costs were $2.5 million for the thirty-nine weeks ended February 24, 2019.