Update on Disposal of European Starch Operations
Tate & Lyle PLC
9 May 2007 - Tate & Lyle PLC
Update on the Disposal of European Starch Operations
Tate & Lyle announces that it is at an advanced stage of exclusive discussions
with Syral SAS (a subsidiary of Tereos of France) which may lead to the disposal
of its interest in certain of the facilities of its Food & Industrial
Ingredients, Europe division ('TALFIIE'), and that it has today begun the
consultation process with the European and local works councils and other
employee representatives.
Tate & Lyle announced on 25 October 2006 that it was exploring the possibility
of the full or partial disposal of TALFIIE. The TALFIIE operations that are
subject to the ongoing discussions ('the Target Businesses') announced today are
those in the UK, Belgium, France, Spain and Italy.
Tate & Lyle's operations in Koog, The Netherlands (the main site in Western
Europe for corn-based value added starch production), Morocco and the Eaststarch
joint venture (which has operations in Hungary, Slovakia, Bulgaria, Romania and
Turkey) are excluded from these discussions. Tate & Lyle will continue to
develop its value added ingredients business in Europe through these businesses
together with its Global Food Ingredients Group, which includes Cesalpinia
Foods, and (upon completion) G.C. Hahn, and will continue to seek to supplement
its value added business through the acquisition of further bolt-on ingredient
companies.
TALFIIE's Belgian entity includes the head office, shared service centre and
single billing entity in Aalst, Belgium ('SSC'). The SSC is excluded from the
sale discussions and consultations are now underway regarding how, if the
disposal of the Target Businesses goes ahead, the functions currently performed
in the SSC will be restructured to reflect the requirements of Syral and of Tate
& Lyle for their respective retained operations in Europe.
Following consultation with employee representatives, any transaction would be
subject to antitrust approval in Europe. The earliest anticipated date for
completion is therefore the end of summer 2007.
FINANCIAL CONSIDERATION
The gross cash consideration for the Target Businesses before restructuring
costs is expected to be in the range of £200 million to £220 million. Based on
un-audited pro forma figures for the year 31 March 2007, the proportions of
TALFIIE operating profits and net operating assets attributable to the Target
Businesses were both approximately 50%.
On the assumption that an agreement in the terms currently contemplated is
entered into, the Board is now actively considering the utilisation of the
proceeds as part of a return of capital to shareholders and expects to be in a
position to update shareholders in this regard at the AGM on 18 July 2007.
Further announcements will be made as appropriate.
ENDS
Notes to Editors
Tereos is an agro-industrial cooperative Group which processes 500,000 hectares
of sugar beets, sugar canes and cereals into sugars and alcohols. Tereos brings
together 14,000 sugar beet and cereal farmers and employs 6,500 people. Tereos
operates 27 industrial production facilities in France, Czech Republic, Brazil,
La Réunion and Mozambique to produce 2.9 million tonnes sugar and 1 million m3
of ethanol and alcohol.
Syral is the fourth largest European producer of glucoses and other starch-based
sweeteners. The plant, located in Marckolsheim in Alsace, processes 600,000
tonnes of maize and wheat annually into 340,000 tonnes of finished products. The
turnover for previous fiscal year ending on September 30, 2006, was 177 million
Euros.
Additional information can be found on websites www.tereos.com and www.syral.fr.
CONTACTS
Mark Robinson, Director of Investor Relations
Tel: +44(0)20 7626 6525 or Mobile: +44(0)7793 515861
Ferne Hudson, Head of Media and Public Relations
Tel: +44(0)20 7626 6525 or Mobile: +44 (0)7713 067433
About Tate & Lyle: Tate & Lyle is a world leading manufacturer of renewable food
and industrial ingredients. It uses innovative technology to transform corn,
wheat and sugar into value-added ingredients for customers in the food,
beverage, pharmaceutical, cosmetic, paper, packaging and building industries.
The Company is a leader in cereal sweeteners and starches, sugar refining, value
added food and industrial ingredients, and citric acid. Tate & Lyle is the world
number-one in industrial starches and is the sole manufacturer of SPLENDA(R)
Sucralose.
Headquartered in London, Tate & Lyle is listed on the London Stock Exchange
under the symbol TATE.L. In the US its ADRs trade under TATYY. The Company
operates more than 65 production facilities in 29 countries, throughout Europe,
the Americas and South East Asia. It employs 7,000 people in its subsidiaries
with a further 4,800 employed in joint ventures. Sales in the year to 31 March
2006 totalled £3.7 billion. Additional information can be found on this website
www.tateandlyle.com.
SPLENDA(R) and the SPLENDA(R) logo are trademarks of McNeil Nutritionals, LLC
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