5 July 2010
Tate & Lyle sells sugar business to US firm
Tate & Lyle announce a sugar-free future after brokering a deal with US sugar-refiners.
Britain’s oldest brand, Tate & Lyle PLC, has announced the sale of its European sugar refining business to American Sugar Refining (ASR) for £211 million.
The British company is to concentrate on its industrial food ingredients division, which produces items such as sweeteners, starch and ethanol, used in processed foods, says chief executive Javed Ahmed. “Sugar refining has enjoyed a long and proud history with Tate & Lyle, but we believe the interests of this business and its employees are now best served by being part of a company for whom sugar refining is core,” he adds.
The British company is putting proceeds of the deal to reduce its net debt levels
Sweet deal
Tate & Lyle, which is putting the proceeds of the deal toward reducing its net debt levels of £814 million, has suffered from a fall of profits recently due to a range of factors including fluctuating currency markets, higher corn costs and lower sugar prices brought about by EU reforms in 2006.
The US firm will add Tate & Lyle to their growing pool of refining businesses, which already includes US and Canadian operations brought in 2001 and 2007. Luis Fernandez, ASR co-president, says: “Tate & Lyle is steeped in 130 years of tradition and consumer loyalty. We recognize the importance and history of the Tate & Lyle sugar brand and are proud to add it to our existing brand portfolio.”
The sale follows other high-profile acquisitions of British industry, including Dairy Milk producer Cadbury’s, which was bought out earlier this year, by US food giant Kraft in February, and German national rail operator, Deutsche Bahn, gaining control of Arriva, for £1.5 billion. The new owners have maintained there will be no job losses as a result of the deal.
Have your say
Do you have experience of communicating through a company acquisition? What are the next steps for the Tate & Lyle/America Sugar Refining communication teams?
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