NEW YORK, July 12, 2021
/PRNewswire/ -- KPS Capital Partners, LP ("KPS") announced
today that it has entered into a definitive purchase agreement with
Tate & Lyle PLC ("Tate & Lyle") (LSE: TATE.L) to acquire a
controlling stake in its Primary Products business in North America and Latin America and its interests in the
Almidones Mexicanos S.A de C.V and DuPont Tate & Lyle
Bio-Products Company, LLC joint ventures (collectively, the
"Primary Products Business" or the "Company"), through a newly
formed company ("NewCo"), for an enterprise value of $1.7 billion. KPS and Tate & Lyle, through
affiliates, will each own approximately 50% of NewCo with KPS
having Board of Directors and operational control. Completion of
the transaction is expected in the first quarter of 2022 and is
subject to customary closing conditions and approvals.
The Primary Products Business is a leading provider of nutritive
sweeteners, industrial starches, acidulants and other corn-derived
products in North America and
Brazil. Founded in 1906 as A.E.
Staley Manufacturing Co., the Primary Products Business has an over
100-year history of producing corn-derived products in the United States. The Company produces
corn-derived products for a diverse set of end-uses including
carbonated beverages, confectionery products, packaging
applications and animal feed, among others, and is proud to serve
some of the world's most recognizable food and beverage brands.
With approximately 1,700 employees across six manufacturing
facilities in the United States
and Brazil, the Primary Products
Business generates annual revenue of approximately $2.3 billion.
Michael Psaros, Co-Founder and
Co-Managing Partner of KPS, said, "KPS is excited to make a
controlling investment in the Primary Products Business and is
honored to partner with Tate & Lyle. KPS and Tate &
Lyle have complete alignment of interests and have cemented a
partnership based on shared values such as the safety of our
employees and a demonstrated commitment to sustainability.
"Our investment in NewCo will create a leading, independent and
focused manufacturer of critical corn- derived ingredients for both
food and industrial markets. The size and scale of NewCo, and
the tremendous growth opportunities made available by serving as a
critical supplier to the world's preeminent food, beverage and
industrial companies, forms the foundation of a tremendous
investment platform. We will leverage our successful,
multi-decade experience of investing in process industries, our
commitment to manufacturing excellence and global network to drive
increases in revenues, productivity and profitability.
We intend to work closely with the management team of the
Primary Products Business to accelerate growth opportunities by
making substantial investments in NewCo's assets and operations,
while also pursuing synergistic add-on acquisitions. We will
invest in research and development in close cooperation with
customers to introduce new products and product categories, in
order to capitalize on long-term trends such as the transition to a
more plant-based diet by consumers worldwide."
Nick Hampton, Chief Executive
Officer of Tate & Lyle, said, "We have been very impressed with
KPS and are excited to partner with them in the next phase of the
development of the Primary Products Business. KPS has proven
expertise in managing and creating value in large manufacturing
businesses, and we look forward to working with them under the
long-term agreements we have established to provide supply security
and economic protection to both the Primary Products Business and
Tate & Lyle's retained businesses."
Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as
legal counsel to KPS and its affiliates. Barclays is acting as
financial advisor to KPS. Debt financing to support the transaction
is being led by Barclays, BNP Paribas, Goldman Sachs & Co. LLC,
Rabobank and Wells Fargo.
About The Primary Products Business
The Primary Products Business is a leading provider of nutritive
sweeteners, industrial starches, acidulants and other corn-derived
products in North America and
Brazil. Founded in 1906 as
A.E. Staley Manufacturing Co., the Primary Products Business has an
over 100-year history of producing corn-derived products in
the United States. The
Company produces corn-derived products for a diverse set of
end-uses including carbonated beverages, confectionary products,
packaging applications and animal feed, among others, and is proud
to serve some of the world's most recognizable food and beverage
brands. With approximately 1,700 employees across six manufacturing
facilities in the United States
and Brazil, the Primary Products
Business generates annual revenue of approximately $2.3 billion.
About Tate & Lyle PLC
Tate & Lyle PLC is a leading global provider of food and
beverage ingredients and solutions. Tate & Lyle has an
over 160-year history of ingredient innovation, and partners with
customers to provide consumers with healthier and tastier choices
when they eat and drink. Through its expertise in sweetening,
mouthfeel and fiber fortification, Tate & Lyle's Food &
Beverage Solutions business develops solutions which reduce sugar,
calories and fat, add fiber and provide texture and stability in
categories including beverages, dairy, bakery, soups, sauces and
dressings. Tate & Lyle's purpose is Improving Lives for
Generations by supporting healthy living, building thriving
communities and caring for the planet. For more information,
visit www.tateandlyle.com.
About KPS Capital Partners, LP
KPS, through its affiliated management entities, is the manager of
the KPS Special Situations Funds, a family of investment funds with
approximately $12.8 billion of assets
under management (as of March 31,
2021). For nearly three decades, the Partners of KPS have
worked exclusively to realize significant capital appreciation by
making controlling equity investments in manufacturing and
industrial companies across a diverse array of industries,
including basic materials, branded consumer, healthcare and luxury
products, automotive parts, capital equipment and general
manufacturing. KPS creates value for its investors by working
constructively with talented management teams to make businesses
better, and generates investment returns by structurally improving
the strategic position, competitiveness and profitability of its
portfolio companies, rather than primarily relying on financial
leverage. The KPS Funds' portfolio companies currently generate
aggregate annual revenues of approximately $13.5 billion, operate 156 manufacturing
facilities in 23 countries, and have approximately 40,000
employees, directly and through joint ventures worldwide (as of
March 31, 2021, pro forma for recent
acquisitions). The KPS investment strategy and portfolio
companies are described in detail at www.kpsfund.com.
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SOURCE KPS Capital Partners, LP