Tate & Lyle has signed an agreement with Xuzhou Yitong Food Industry (“Yitong”) to form a Sino-Foreign joint venture (“Tate & Lyle Howbetter”) through the acquisition of a 51% equity interest in Jiangsu Howbetter Food (“Howbetter”), a leading food systems business in the People’s Republic of China.
Under the terms of the agreement, Tate & Lyle will acquire 22% of its equity interest from Yitong and the balance of 29% from S.B International, a wholly-owned subsidiary of a Europe-based global food business (which has been a shareholder in Howbetter since 2009). Tate & Lyle also has an option to acquire Yitong’s remaining 49% equity interest in Howbetter at a later stage. The transaction is subject to governmental approval which is expected in the autumn.
Howbetter provides stabiliser systems and ingredient blends for customers across China mainly in the dairy and beverage categories. It operates from a blending facility in Suqian and has application laboratories in the nearby city of Xuzhou. Howbetter was one of the first domestic food blending businesses in China to be awarded a license to operate under new regulations put in place in 2010.
“The combination of Tate & Lyle’s global blending capabilities and recipe know-how with Howbetter’s strong local expertise and infrastructure provides us with an excellent platform on which to accelerate the growth of our Food Systems business in China,” said Olivier Rigaud, president, Speciality Food Ingredients for Tate & Lyle.
“Tate & Lyle and Howbetter are two highly complementary businesses with the same absolute focus on quality and customer service,” said Feng Guang, chairman, Yitong and general manager, Howbetter, and who will also be general manager of Tate & Lyle Howbetter. “Together, we will be able to offer our customers in China a significantly enhanced range of products and technical expertise.”
