The ingredients company has confirmed that discussions with potential buyers are at an early stage
British ingredients company Tate & Lyle is exploring the sale of its sweetener division and it has been reported that the move seeks to position the company closer to the better-for-you food category.
The sweetener division of Tate & Lyle operates under the Primary Products business, which includes the company’s Food and Beverage business. The Primary Products business sells artificial sweeteners used in soft drinks and industrial starches, and it accounted for £1.8 billion of revenue in 2020. Tate & Lyle reported revenues of £2.8 billion last year.
Tate & Lyle said in a statement that it continues to “successfully execute its strategy and remains confident in the future growth prospects of the company”.
The statement also reveals that the board of directors believes that if a transaction of this nature was completed it would enable Tate & Lyle and the new business to focus its respective strategies and capital allocation priorities and create the opportunity for enhanced shareholder value.
US private equity firms Apollo Global Management and Cerberus have been named as possible suitors as both companies have already held talks with the British company.
The London-listed company saw it share price rose by 6% on Monday, as the Sunday Telegraph broke the story over the weekend. Stocks were trading at 674p per share in January and at the time of writing stocks were at 786p.
Date published: 27 April 2021