KPS Capital Partners LP has entered into a definitive purchase agreement with Tate & Lyle PLC 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, through a newly formed company, 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 provider of nutritive sweeteners, industrial starches, acidulants and other corn-derived products in North America and Brazil.
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.”
Nick Hampton, CEO 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.