| TATE & LYLEs plans to sell its US sugar beet business have hit an
impasse as the sugar growers co-operative set to buy the division has been
unable to secure funding for the deal. The Rocky Mountain Sugar Growers
Co-operative, which signed a preliminary agreement to buy Tates Western
Sugar Company for 89 million in June, has been unable to find bank
guarantees for more than 60 per cent of the cash it needs.
Tate & Lyle said that, in the light of the co-ops difficulties,
it has extended the deadline for the sale until the end of January, when
sugar inventories for the year are complete. When the inventories are
complete the banks will be able to see a clearer picture of how the
business can perform, Simon Gifford, Tates finance director, said.
It is understood, however, that Tate will seek another buyer if the Rocky
Mountain deal is not finalised by next February.
The sale of Domino Sugar, another US business, has been passed by US
regulators, Mr Gifford added.
Tate & Lyle shares rose 6p to 240p. Most analysts attributed
the rise to the renewal of a licensing deal signed yesterday with a
division of Johnson & Johnson, the US consumer goods company.
Under the deal Tate and Johnson will continue to develop an artificial
sweeteners product called Sucralose with Johnson paying Tate $10 million
(6.8 million) a year for three years. |