Corn Products to Acquire SPI Polyols’ Food Business
Corn Products will also acquire Getec, a major Brazilian producer of polyols, including liquid sorbitol and mannitol, and anhydrous dextrose, for the personal care, food, candy and confectionary, and pharmaceutical markets.
15/01/07 Corn Products International, Inc. (CPO) has entered into a definitive agreement with SPI Polyols, Inc., a subsidiary of ABF North America Holdings, Inc., to acquire the food business of SPI Polyols and the shares of an SPI unit that holds the remaining 50 percent of Getec Guanabara Quimica Industrial S.A., or Getec, in Brazil. Financial terms were not disclosed. The combined businesses are expected to have annual sales of nearly $100 million. The pharma business of SPI is not included in the transaction and will continue to be operated by SPI.
The transaction is expected to be accretive in the first year to Corn Products International's earnings per share and meet the Company's stated target for return on capital employed (ROCE) of 8 1/2 to 10 percent.
"This acquisition will strengthen our sweeteners platform and reinforce our Pathway strategy to expand our value-added, specialty product portfolio and become a broader-based ingredients company," said Sam Scott, chairman, president and chief executive officer of Corn Products International. "The acquisition also would make us a leading producer of polyols in Latin America with facilities in Brazil, Mexico and Colombia, and would allow us to enter the US and Canadian markets primarily as a specialty polyols supplier."
The food business of SPI Polyols produces and sells specialty polyols, including crystalline sorbitol, crystalline maltitol, mannitol, specialty liquid polyols and liquid sorbitol for the food, beverage, confectionary, industrial, personal and oral care, and nutritional supplement markets. Polyols are sugar-free, reduced calorie sweeteners primarily derived from starch.
Getec is a major Brazilian producer of polyols, including liquid sorbitol and mannitol, and anhydrous dextrose, for the personal care, food, candy and confectionary, and pharmaceutical markets. In September 2006, Corn Products International increased its equity ownership in Getec to 50 percent from 20 percent.
The proposed transaction, which has been approved by Corn Products International's Board of Directors, is subject to customary closing conditions. Closing is anticipated in the first quarter of 2007.
