Tate & Lyle Jumps as Company Explores Sale of Stake in Unit
Tate & Lyle shares rose the most in almost six months after the 162-year-old company said it’s exploring the sale of a controlling stake in its largest unit.
Discussions with potential buyers for the primary products business are at an early stage and there’s no certainty that a deal will be concluded, the firm said Sunday.
Historically known as one of Europe’s leading sugar producers, Tate & Lyle sold that business a decade ago and now focuses on food ingredients, including sweeteners like Splenda and Tasteva. The primary products division generated about 1.8 billion pounds ($2.2 billion) in revenue in fiscal 2020, or more than 60% of the total, according to the annual report.
The stock rose as much as 7% in early trading, the most since November, and was 6.4% higher at 805.6 pence by 9:08 a.m. in London. It has gained 19% this year.
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The company “continues to successfully execute its strategy and remains confident in the future growth prospects of the company,” it said in a statement, adding that the transaction envisaged “would enable Tate & Lyle and the new business to focus their respective strategies and capital allocation priorities.”
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