Südzucker to sweeten results with speciality ingredients

Related tags Food Fructooligosaccharide Nutrition

The largest sugar producer in Europe Südzucker has divested all
shares in the Spanish food group Ebro Puleva through the group's
subsidiary Saint Louis Sucre, providing it with breathing space to
concentrate on speciality ingredients.

Shedding a total of 21.8 million shares, the slice represents Südzuckers entire holding in the Spanish food company.

"The disposal is another important step in Südzucker's strategy to focus on the core business with full control. The funds will be available for further growth within the group's expanding specialities business,"​ said the German sugar group in a statement yesterday.

Last year the group launched a €250 million convertible bond to buy the remaining 15 per cent stake in its Belgian unit Raffinerie Tirelemontoise, the owner of prebiotic ingredients company Orafti.

"We will thereby increase our stake in RT to 100 per cent, and we will also indirectly increase our stake in RT's French subsidiary Saint-Louis Sucre to 100 per cent as well,"​ said the company at the time.

A decline in the global sugar market price and a weak dollar have taken their toll on Südzucker finances, as with other European sugar companies. Value added ingredients could offer a lucrative path to beat the downward figures.

Sales of inulin and oligofructose, both supplied by Orafti, have enjoyed rapid popularity in recent years, linked to their multiple properties as food ingredients, reducing fat and carbohydrates in food products and adding prebiotic properties (beneficial to gut health).

Orafti recently reported research showing that a daily dose of its Raftilose Synergy1, a patented combination of inulin and oligofructose, increased calcium absorption in human volunteers. It is also researching the role of Raftilose Synergy1 in reducing the risk of colon cancer.

Such benefits have led to a fast growth rate. Orafti says it has seen annual growth above 25 per cent for many years and its Oreye, Belgium plant will soon reach maximum production capacity.

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