KPS Capital Partners acquires a majority stake in Tate & Lyle's Primary Products Business

KPS Capital Partners, LP

NEW YORK, Jan.

New Company becomes a leading manufacturer of herbal products for the food and industrial markets

Company focuses on growth and sustainability

Tate & Lyle PLC retains approximately 50% of the ownership

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 interest in Primary Products Business in North America and Latin America as well as the stakes in the joint ventures Almidones Mexicanos SA de CV and DuPont Tate & Lyle Bio-Products Company, LLC (together “Primary Products Business” or the “Company”) through a newly founded company (“NewCo”) an enterprise value of $ 1,7 billion. KPS and Tate & Lyle will each hold approximately 50% of NewCo through affiliated companies, with KPS having the board of directors and operational control. The transaction is expected to close in the first quarter of 2022 and is subject to customary closing conditions and approvals.

Primary Products Business is a leading supplier of sweeteners, industrial starches, acidulants, and other corn-derived products in North America and Brazil. Primary Products Business was founded in 1906 as AE Staley Manufacturing Co. and has a history of over 100 years manufacturing corn products in the United States. The company manufactures corn products for a variety of end uses, including carbonated beverages, confectionery, packaging applications, and animal feed. With around 1.700 employees in six production sites in the USA and Brazil, Primary Products Business generates annual sales of around 2,3 billion US dollars.

Michael Psaros, Co-Founder and Managing Partner of KPS, said, “KPS is excited to join Primary Products Business and is honored to work with Tate & Lyle. The interests of KPS and Tate & Lyle are completely aligned and have cemented a partnership based on shared values ​​such as the safety of our employees and a demonstrative commitment to sustainability.

“Our investment in NewCo will create a leading, independent and focused manufacturer of critical corn ingredients for the food and industrial markets. The size and scope of NewCo, as well as the tremendous growth opportunities that arise from its role as a major supplier to the world's leading food, beverage and industrial companies, form the basis for a great investment platform. We will use our successful decades of investment experience in the process industry, our commitment to excellent manufacturing quality and our global network to increase sales, productivity and profitability.

We intend to work closely with the Primary Products Business management team to accelerate growth opportunities by making substantial investments in NewCo's assets and operations while seeking synergetic add-on acquisitions. We will invest in research and development in close collaboration with our customers to introduce new products and product categories in order to benefit from long-term trends such as the transition to a more plant-based diet of consumers worldwide. "

Nick Hampton, Chief Executive Officer of Tate & Lyle, said, “We are very impressed with KPS and look forward to working with them in the next phase of the development of the primary products business. KPS has a proven track record of managing and creating value in large manufacturing operations, and we look forward to working with them under the long-term contracts we have signed to cover both the Primary Products Business and the remaining Tate & Lyle businesses To offer economic protection. "

Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal advisor to KPS and its affiliates. Barclays is acting as financial advisor to KPS. The debt financing in support of the transaction will be provided by Barclays, BNP Paribas, Goldman Sachs & Co. LLC, Rabobank and Wells Fargo.

Information on Primary Products Business

Primary Products Business is a leading supplier of sweeteners, industrial starches, acidulants, and other corn-derived products in North America and Brazil. Primary Products Business was founded in 1906 as AE Staley Manufacturing Co. and has a history of over 100 years manufacturing corn products in the United States. The company makes corn products for a variety of end uses including carbonated beverages, confectionery, packaging applications, and pet food, and prides itself on serving some of the most recognized food and beverage brands in the world. With around 1.700 employees in six production sites in the USA and Brazil, Primary Products Business generates annual sales of around 2,3 billion US dollars.

Information on Tate & Lyle PLC

Tate & Lyle PLC is a leading global provider of food and beverage ingredients and solutions. Tate & Lyle has a history of over 160 years of ingredient innovation and works with customers to offer consumers healthier, tastier choices when it comes to eating and drinking. With expertise in sweetening, mouthfeel and fiber fortification, Tate & Lyle's Food & Beverage Solutions division develops solutions that reduce sugar, calories and fat, add fiber, and texture and stability in categories such as beverages, dairy products, baked goods, soups, sauces and offer dressings. Tate & Lyle's goal is to improve the lives of generations by supporting healthy lives, building thriving communities, and caring for the planet. For more information, see www.tateandlyle.com.

About KPS Capital Partners, LP

Through its affiliated administrative units, KPS is the manager of KPS Special Situations Funds, a family of mutual funds with assets under management of approximately $ 12.8 billion (as of March 31, 2021). For nearly three decades, KPS partners have worked solely to generate significant capital growth through controlling equity stakes in manufacturing and industrial companies in a variety of industries including basic materials, branded consumer goods, health and luxury products, auto parts, capital goods, and general manufacturing. KPS creates value for its investors by working constructively with talented management teams to improve businesses. It generates returns on investment by structurally improving the strategic position, competitiveness and profitability of its portfolio companies rather than relying primarily on financial leverage. The KPS Funds portfolio companies currently generate total annual sales of around 13,5 billion US dollars, operate 156 production sites in 23 countries and employ around 40.000 people worldwide, both directly and through joint ventures (as of March 31, 2021, pro forma for recent acquisitions). The KPS investment strategy and portfolio companies are below www.kpsfund.com. described in detail.

Press contact:

Business inquiries: KPS
212 338 5100

Media Relations: Prosek Partners - Phil Walters
+ 44 777 333 1589 or pro-kps@prosek.com

Original content by: KPS Capital Partners, LP, transmitted by news aktuell