Tate & Lyle has announced that it has agreed to an acquisition offer from the US food and ingredients provider, Ingredion, valued at £2.7bn.

The overall offer of £6.15 per Tate & Lyle share represents a 58.7% premium on the FTSE 250 food and beverage supplier’s closing share price on 13 May.

The offer comes after Tate & Lyle completed a major strategic and structural transformation, and presented an updated medium-term strategic roadmap, which aimed to accelerate growth through a combination of its enlarged portfolio.

However, in the last year, the operating environment for ingredients companies and its customers has slowed, as consumer sentiment has weakened across all major regions, leading it to lower its guidance and expectations for near-term future performance.

The British firm said that while it remains confident in its ability to deliver “attractive value” for its shareholders, it believes that the financial terms of the acquisition represent an attractive opportunity.

Ingredion added that the acquisition will bolster its portfolio and diversify its global platform with critical scale in North America, Europe and emerging markets.

Chairman and CEO at Ingredion, Jim Zallie, stated: "Combining Ingredion and Tate & Lyle's complementary portfolios creates a global leader in ingredient solutions with the expertise and geographic reach to help shape the future of food.

"The combined business will be better positioned to serve customers' needs for the development of great-tasting, healthier and affordable food products that consumers demand. This compelling combination will create exciting new possibilities for employees and generate significant value for all stakeholders."

Investment director at AJ Bell, Russ Mould, said that the deal would be another knock to the London Stock Exchange.

He concluded: “"Ingredients business Tate & Lyle’s time as a public company looks to be up. Having secured the agreement of the board, a cash bid at a chunky premium from US rival Ingredion looks like it could be enough to get a deal over the line.

"Tate exited its eponymous sugar business more than 15 years ago and might now go out with a whimper. Shareholders might be relieved to exit after a disappointing period affected by weak demand, mounting costs and the impact of weight-loss drugs.

"A successful takeover represents another loss to the London market as it struggles to attract substantial new listings to replace the names which are steadily disappearing from its ranks."

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