US Sugar, the century-old privately-held agricultural company based on Florida, had reached an accord to purchase the businesses alongside assets of California-based regional rival Imperial Sugar from commodities trader Louis Dreyfus, US Sugar and Louis Dreyfus said in a joint statement on Wednesday.
Although, financial terms of the deal had yet to be revealed, but US Sugar, the United States’ largest producer of sugar cane having had a capacity to produce more than 700,000 tons per year, had added in the statement that the takeover would be financed through debts pledged earlier by the heavy-weight US lender Wells Fargo and PGIM Agricultural Finance, as Wells Fargo LLC has been acting as the exclusive financial adviser to US Sugar, cementing ways to stem a synergy between the domestic rivals.
US Sugar to purchase Imperial Sugar from Louis Dreyfus
Imperial Sugar which operates a refinery at Port Wentworth in Savannah, Georgia alongside a sugar liquidation and transfer facility in Ludlow, Kentucky, was purchased by Louis Dreyfus back in the 2012s for a lump-sum of $78 million, while following reveal of the deal, Louis Dreyfus was quoted saying that the divestiture would enable it to focus more on its global sugar trading business.
Surprisingly, Louis Dreyfus seemed to be in a hurry to offload a flurry of sugar-related assets from its portfolio, as the commodity broker had recently announced another divestment of a sugar production business.
US Sugar’s 200,000 acres of sugar cane farm coupled with colossal sugar cane processing units in Imperial Sugar, would likely strengthen US Sugar’s footprints further in the US commodity market, suggested analysts.