Tate & Lyle sells sugar business to US
Tate & Lyle has sold its historic sugar business, which includes the iconic Golden Syrup brand, to American Sugar Refining in a £211 million (€256m) deal. The sale of its EU Sugar Refining operations is part of the food group’s new strategy to focus on its fast-growing food ingredients business.
“Sugar refining has enjoyed a long and proud history within 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,” says Javed Ahmed, chief executive of Tate & Lyle. Ahmed opened the way for a sale of the struggling, low-margin sugar business earlier this year when he promised to focus on fast-growing specialist starches and super sweeteners.
The disposal is expected to complete in about two months and will result in a book loss of about £55m (€67m). The sale excludes historic UK pension assets and liabilities.
EU Sugar Refining consists of the cane sugar refineries in London and Lisbon, the Lyle’s Golden Syrup factory in London, the associated sugar and syrup brands and the Tate & Lyle Process Technology consulting business. In the year to March these businesses had sales of £689m (€836m).
“Tate & Lyle’s clear priority is to grow its speciality food ingredients business, supported by cash generated from bulk ingredients,” adds Ahmed. “This disposal will enable us to concentrate our resources on delivering our strategic objectives as we focus, fix and grow our business.”
The global market for speciality food ingredients is though to be worth around £20 billion (€24bn) and growing at 5% a year.
