SUGAR LAND, TX, August 17, 2001 -- Imperial Sugar Company (OTC BB:IPRL) today announced that it has agreed to sell its Michigan Sugar operations to Michigan Sugar Beet Growers, Inc.  ("MSBGI").  Under the terms of the Stock and Asset Sale Agreement, the Company will sell to MSBGI all of the wholly-owned capital stock of Michigan Sugar Company and Great Lakes Sugar Company and license and sell certain intellectual property related to the Michigan Sugar operations.  Imperial would continue to market the refined sugar products for a minimum term of ten years.

Terms of the transaction include an initial cash payment of $55 million, the assumption of $18.5 million in industrial development bonds by MSBGI and a $10 million deferred payment provision.  The net proceeds will be used to reduce debt.  Net sales from the Michigan Sugar operations for the year ended September 30, 2000, were approximately $181.9 million.

Should the transaction not close by October 1, 2001, MSBGI shall lease the four Michigan Sugar factories from the Company and pay a combined lease, management and marketing fee.  MSBGI has until March 1, 2002, to close on the Stock and Asset Sale Agreement.

James C. Kempner, President and CEO of Imperial Sugar Company commented, This is a win-win transaction for both Imperial and the sugarbeet growers who supply the Michigan factories.  The purchase of Michigan Sugar gives the sugarbeet grower-owners complete control over their production from seed to refined sugar while Imperial is able to utilize the proceeds from the sale to continue its program of debt reduction.  Imperials continuing role as exclusive marketer for refined sugar processed at the Michigan factories gives it a continuing stream of income from the Michigan operations while giving the grower-owners the benefit of Imperials sales and marketing expertise and national market presence.

Imperial Sugar Company filed a petition for relief under chapter 11 of the U.S. Bankruptcy Code in the District of Delaware on January 16, 2001.  The Bankruptcy Court confirmed the Company's Second Amended and Restated Joint Plan of Reorganization on August 7, 2001.  The Company has received Bankruptcy Court approval for this transaction.