Tate & Lyle PLC, the maker of the sweetener Splenda, has agreed to sell its Canadian sugar unit to closely held American Sugar Refining Inc. as part of a shift toward more-profitable products.
The company will be paid £132-million ($301.9-million) on completion of the deal, according to a statement released yesterday.
Tate has been selling off businesses and closing plants to focus on products such as starches and the sucralose sweetener Splenda since the European Union cut sugar-production quotas. The company, once the world's biggest sugar refiner, had a loss in the 12 months ended March 31, and expects profit to miss estimates this year.
The sale of Tate & Lyle Canada, also known as Redpath Industries Ltd., "marks another important step in focusing Tate & Lyle's business on its value added strategy," CEO Iain Ferguson said.
Redpath, which runs a cane-sugar refinery in Toronto and a packing operation in Niagara Falls, had sales of £177-million in the last fiscal year, Tate said. The unit contributed £18-million to Tate's underlying profit.
The refinery is a landmark building on the Toronto waterfront. Last year, the famous "Redpath Sugar" sign that adorned the north side of the building was removed and replaced with a new "Tate & Lyle" sign. TATE (London) fell 5 pence to £5.92.