Tate & Lyle to sell Canadian sugar business
February 14, 2007
by Eric Schroeder
LONDON — Tate & Lyle, P.L.C. signed an agreement to sell Tate & Lyle Canada Ltd., or Redpath, to American Sugar Refining, Inc. Tate & Lyle will receive a net consideration of £132 million ($259 million), subject to closing adjustments relating to working capital, and use it to reduce Group debt.
American Sugar Refining is owned by Florida Crystals Corp. and the Sugar Cane Growers Cooperative of Florida.
Redpath operates a cane sugar refinery in Toronto and a packing operation in Niagara Falls, Ont. Redpath had total sales of £177 million in the fiscal year ended March 31, 2006, and a profit before interest and exceptional items of £18 million. The company had gross assets of £110 million and net operating assets of £84 million on Sept. 30, 2006.
"The sale of Redpath marks another important step in focusing Tate & Lyle’s business on its value-added strategy," said Iain Ferguson, chief executive for London-based Tate & Lyle.
The sale is conditional upon regulatory approvals covering the Canadian competition bureau, foreign investment and taxation. The approvals are expected within 90 days.