Tate & Lyle spins off industrial sweeteners, starches division to focus on specialty food and beverage solutions

By Elaine Watson

- Last updated on GMT

Nick Hampton: 'Today’s announcement represents the next phase in the evolution of Tate & Lyle...' Picture credit: Tate & Lyle
Nick Hampton: 'Today’s announcement represents the next phase in the evolution of Tate & Lyle...' Picture credit: Tate & Lyle

Related tags Tate & lyle

Tate & Lyle has struck a $1.3bn deal to sell a controlling stake in its 'Primary Products' industrial sweeteners and starches business in the Americas to private equity firm KPS Capital Partners, as it focuses on specialty sweeteners, fibers, texturants and other high-value food & beverage ingredients.

The Primary Products business will be moved into a newly formed company called NewCo in which Tate & Lyle will retain a 50% stake.

NewCo comprises three corn wet mills in the US, acidulant plants in the US and Brazil; a 50% stake in two joint ventures – Almex in Guadalajara, Mexico and Bio-PDO, in Loudon, Tennessee; and a grain elevator network and bulk transfer stations in North America.

Tate & Lyle will in turn focus on specialty ingredients for sweetening, mouthfeel, and fortification, such as allulose, sucralose, locust bean gum, stevia, specialty starches, fiber, tapioca and products from selected corn wet mills in Indiana, the Netherlands, and Solvakia.

Primary Products’ European operations, which accounted for around 5% of Primary Products’ revenue in the year ended 31 March 2021, will remain with Tate & Lyle, which said the deal would reduce its exposure to commodities markets in North America.

Upon completion of the deal - expected in the first quarter next year – Tate & Lyle plans to return about £500m to shareholders in a special dividend and retain remaining proceeds for investment, to strengthen its balance sheet, and for M&A, said Tate & Lyle, which sold its sugar business in 2010.

Sweetening, mouthfeel, and fortification

CEO Nick Hampton said: “Today’s announcement represents the next phase in the evolution of Tate & Lyle. Our one strong company will become two stronger businesses, both in a position to pursue new and exciting growth opportunities in their respective markets.”

Speaking on a call with analysts this morning, Hampton said sweetening, mouthfeel, and fortification were areas of "significant growth​" for Tate & Lyle, adding:

"Over the last three years, in sweetening, revenue from products supporting sugar reduction, excluding sucralose, ​increased by a compound annual growth rate of over 20%. Over the same period, in mouthfeel, our range of clean label texturants delivered revenue growth with a CAGR of over 30%; and in fortification revenue for our soluble fibers grew by more than 15%."

Related news

Show more

Related products

show more

PREPARING FOR Q4 & Q1 2024

PREPARING FOR Q4 & Q1 2024

Content provided by Icon Foods | 24-Jan-2024 | White Paper

Good afternoon fellow food manufacturers, formulators, and enthusiasts of Clean Label Sugar Reduction. You know, in the past, we’ve seen our fair share...

Oat Groats – Heat-treated Oat Kernels

Oat Groats – Heat-treated Oat Kernels

Content provided by Lantmännen Biorefineries AB | 06-Dec-2023 | Product Brochure

Lantmännen offers now Oat Groats: Heat-treated oat kernels, also known as oat groats or kilned oats, undergo heat treatment to inhibit enzymes that could...

Oat Beta-glucan – Clean Label Texturizer

Oat Beta-glucan – Clean Label Texturizer

Content provided by Lantmännen Biorefineries AB | 21-Nov-2023 | White Paper

In today's health-conscious world, consumers seek transparent labels and natural ingredients.

Related suppliers

Follow us

Products

View more

Webinars