The cash deal will see Ingredion, a direct rival, pay up to 615p per share for London‑listed Tate & Lyle, with shareholders to receive 595p per share in cash.
Illinois‑based ingredients giant Ingredion’s acquisition follows several previous proposals, with this final agreement valuing Tate & Lyle at £2.7 billion, or £3.7 billion including debt.
The deal comes as both companies shift their focus towards rising demand for lower‑sugar, higher‑protein products amid a boom in functional food and beverages.
Tate & Lyle’s shares have been under pressure for some time, with the business sounding the alarm over full‑year profits last October and suffering a 10% drop in first‑half profits in November.
Consequently, the British group’s shares shot up 45% when talks between the two were made public last month, in anticipation of a coming deal.
“Over the last few years, Tate & Lyle has been successfully repositioned as a leading global speciality food and beverage solutions business aligned to growing consumer demand for healthier, more nutritious and sustainable food and drink,” said David Hearn, chairman of Tate & Lyle.
“I would like to recognise the exceptional contribution of the team at Tate & Lyle for their talent, insight and commitment, which has been a key driver of this transformation and the business we have built. Looking forward, we believe the next chapter with Ingredion will create a business with even greater potential, greater scale and increased investment in innovation in support of customers.”
He continued: “The Board of Tate & Lyle believes Ingredion’s offer represents an attractive opportunity for shareholders to crystallise value in cash, and that it will be an excellent steward of Tate & Lyle. The Board therefore unanimously recommends Ingredion’s offer to Tate & Lyle shareholders.”
When combined with Ingredion, it is estimated that the resulting business will be worth around £7.4 billion.
The newly merged outfit will focus on ingredients that can improve texture, reduce sugar content and increase nutritional value, in a market that is beginning to reposition itself following the explosion in popularity of GLP‑1 drugs, notably in the United States.
Ingredion CEO Jim Zallie added: “Combining Ingredion and Tate & Lyle’s complementary portfolios creates a global leader in ingredient solutions with the expertise and geographic reach to help shape the future of food.
“The combined business will be better positioned to serve customers’ needs for the development of great‑tasting, healthier and affordable food products that consumers demand. This compelling combination will create exciting new possibilities for employees and generate significant value for all stakeholders.”
