A further blow for City as US private equity giant Advent International makes plans for Tate & Lyle
An American private equity giant is preparing to attack London-listed Tate & Lyle in a further blow to the city.
Advent International is reportedly in the early stages of putting together a bid for the British ingredients supplier.
While the Boston-based buyout group may not decide to make an offer, any approach would exceed the company’s market value of £2.8 billion, the Financial Times reported.
Target: US private equity giant Advent International is reportedly in the early stages of putting together a bid for 165-year-old British ingredients supplier Tate & Lyle
A possible takeover of the company comes as London’s stock market faces a crisis and an exodus of companies.
It would mean that 165-year-old Tate & Lyle, one of the founders of the FT 30 index almost nine decades ago, would leave the stock exchange.
The company’s origins date back to 1859, when Henry Tate set up a sugar refinery in Liverpool before expanding to Silvertown in East London.
In 1921 the company merged with Abraham Lyle & Sons, which was famous for making golden syrup.
Bosses sold the historic sugar business, including Lyle’s golden syrup, to American Sugar Refining in 2010 for £211m. Now the London-based company is focusing on ingredients, including sweeteners.
The potential offer comes as Tate & Lyle attempts to buy US pectin and specialty gum manufacturer CP Kelco for £1.4 billion.
“It appears that private equity has been lured by the sweet taste of a new British takeover,” said Dan Coatsworth of investment platform AJ Bell.
‘It was only a matter of time before someone pounced on the company after the radical restructuring.
Without the baggage, Tate & Lyle had the right ingredients to become a leaner and healthier company, and that seems to have given Advent dollar signs.”
He added: “It feels like Advent – if the rumors are true – saw an opportunity to run the numbers on Tate & Lyle while it was in the process of securing the CP Kelco deal.
“Tackling a company when it is derivative is part of private equity, and the big question now is whether Advent is willing to offer a fair price to win over shareholders.”
London’s stock market is facing a crisis amid a wave of takeovers, from companies deciding to move their stock exchange listings or choosing to float in rival cities such as New York.
There has been a wave of takeover interest in London-listed shares this year.
This has seen companies including Royal Mail owner International Distribution Services, packaging giant DS Smith and logistics company Wincanton agree to be bought.
DIY INVESTMENT PLATFORMS
A. J. Bell
A. J. Bell
Easy investing and ready-made portfolios
Hargreaves Lansdown
Hargreaves Lansdown
Free fund trading and investment ideas
interactive investor
interactive investor
Invest for a fixed amount from € 4.99 per month
Sax
Sax
Get £200 back in trading fees
Trade 212
Trade 212
Free trading and no account fees
Affiliate links: If you purchase a product, This is Money may earn a commission. These deals have been chosen by our editors because we believe they are worth highlighting. This does not affect our editorial independence.