Alfonso Fanjul, the Cuban-born sugar magnate who is chairman and chief executive of Flo-Sun Inc., said in an interview with Reuters that the acquisition of Domino sugar from Tate will provide ``significant synergies.''

``We look at this as an opportunity (to acquire) an asset which is undervalued,'' he said. ``We really think that when we look back in five years or so, it (the deal) would have made a lot of sense to us.''

Tate, the world's biggest sugar group, said earlier Thursday it sold Domino to an investment group headed by Fanjul for around $181 million cash.

Up to $25 million will be payable over four years contingent on the performance of the business, a statement by Florida Crystals, a company whose chairman is Fanjul, added.

Tate had been seeking to dispose of its underperforming U.S. operations, citing their poor performance as part of the reason for dragging down its earnings.

It announced last month the sale of its U.S. Western Sugar Co. unit to the Rocky Mountain Sugar Growers Co-operative for $96 million.

DOMINO TO SPUR EXPANSION IN FANJUL SUGAR BUSINESS

Fanjul said the deflated level of domestic sugar prices in the United States will not likely last.

``We think that they (U.S. sugar prices) will improve, obviously,'' he said, adding Domino is a primary sugar brand with nationwide recognition.

The most-active November sugar No. 14 contract on the New York Board of Trade was 0.04 cent higher at 20.80 cents a lb at 1235 EDT. Brokers said prices have been hovering around two-decade lows due to bumper production and slow demand in the United States.

``By acquiring this brand, it will give us the opportunity to further expand our operations to go directly from the farm to the American consumer which will make us very efficient and (a) cost-efficient company,'' Fanjul added.

Domino will be combined with Refined Sugars Inc., the Yonkers, New York, refinery in which the Fanjuls have an interest. The combined interest will be known as Domino Sugar.

Companies controlled by the Fanjuls will own 61 percent of Domino Sugar and Sugar Cane Growers Co-operative of Florida will own the remaining 39 percent.

Fanjul said the acquisition of Domino may take up to the end of the year to complete and would have to be completed before the company thinks of further acquisitions.

J. Pepe Fanjul, vice-chairman, president and chief operative officer of Flo-Sun Inc. and Florida Crystals, said Domino's brand name is vital in building up their business.

``Integrating the sugar farming, processing, marketing and management expertise of Florida Crystals, Sugar Cane Growers Co-operative of Florida and Domino Sugar will Domino become an even more important brand name nationally in the years ahead,'' he said.

Flo-Sun and Florida Crystals are privately held and controlled by the Fanjuls. Florida Crystals farm about 180,000 acres of sugarcane in Florida and Flo-Sun has operations and holdings in the Dominican Republic and Europe.