Tate & Lyle Plc (LSE:TATE) shares surged more than 12% after U.S.-based ingredients company Ingredion Incorporated reached an agreement to acquire the British food ingredients and solutions group in a cash transaction valued at approximately £2.7 billion.
Under the terms of the recommended deal, Tate & Lyle shareholders will receive 595 pence per share in cash. They will also be entitled to a final dividend of up to 13.2 pence per share for the financial year ended 31 March 2026 and an interim dividend of up to 6.8 pence per share for the six months ending 30 September 2026. Including these permitted dividends, the total value of the offer rises to as much as 615 pence per share.
The cash offer represents a premium of 58.7% to Tate & Lyle’s closing share price on 13 May 2026, the last trading day before the offer period commenced, and a 65.2% premium to the company’s three-month volume-weighted average share price at that date. Including the permitted dividends, the premium increases to 64.0% and 70.8% respectively.
The transaction values Tate & Lyle at an enterprise value of approximately £3.7 billion based on the cash consideration alone, increasing to around £3.8 billion if the dividends are paid in full. The valuation equates to roughly 8.8 times adjusted EBITDA for the 12 months ended 31 March 2026, before taking account of any anticipated synergies.
Ingredion’s pursuit of Tate & Lyle followed a five-stage negotiation process that began with an unsolicited proposal of 530 pence per share, structured as 80% cash and 20% Ingredion stock. The Tate & Lyle board rejected that approach, prompting four further proposals before the parties reached agreement on an all-cash offer.
The combined business is expected to generate approximately $9.9 billion in annual revenue and around $1.8 billion in adjusted EBITDA. Ingredion expects to achieve run-rate net cost synergies of approximately $130 million annually by the end of 2030, with one-off implementation costs estimated at around $175 million.
David Hearn, chairman of Tate & Lyle, said the board believes “Ingredion’s offer represents an attractive opportunity for shareholders to crystallise value in cash.”
Support for the transaction has already been secured through irrevocable undertakings covering 76,186,458 shares, representing approximately 17.1% of Tate & Lyle’s issued share capital as of 5 June 2026. This includes the commitment of Huber Equity Corporation, which owns 75 million shares, equivalent to roughly 16.8% of the company.
Completion of the acquisition remains subject to shareholder approval and regulatory clearances across 12 competition jurisdictions, including the United States, European Union, United Kingdom, China and Brazil. The long-stop date for completion has been set at 8 December 2027.
More about Tate & Lyle
Tate & Lyle Plc is a global provider of food and beverage ingredients and solutions, serving customers across a wide range of consumer markets. The company specialises in sweeteners, texturants, fibres and speciality ingredients that help manufacturers improve the nutritional profile, taste and functionality of food and drink products. Through its science-led approach, Tate & Lyle supports customers worldwide in developing healthier and more sustainable products.
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