Tate & Lyle announces today that Astaxanthin Partners Ltd., its joint venture with Igene Biotechnology Inc., intends to cease production of Astaxanthin at the Tate & Lyle site in Selby, North Yorkshire. Additionally, Tate & Lyle is in discussions with its joint venture partner concerning Tate & Lyle’s exit from this loss making business.
Consultation with employees has now begun and will last 30 days. Closure would affect 45 jobs at the Selby site. Subject to employee consultation, it is planned that Astaxanthin production will cease at the end of September 2007. Tate & Lyle’s share of the operating loss of Astaxanthin for the year to 31 March 2007 was £3 million. Tate & Lyle’s share of cash closure costs are estimated at £3 million. An impairment charge on Tate & Lyle’s investment in Astaxanthin Partners Ltd was taken in the financial year to 31 March 2007.
Stanley Musesengwa, Chief Operating Officer, said: “The difficult decision to begin the consultation process follows a full review of the business and its profitability for the foreseeable future. This decision is not a reflection of the hardworking employees we have at the site and every effort was made to secure the future of the plant. The business has faced pressures due to escalating raw material prices resulting from changes in the EU Sugar Regime and higher energy costs. Unfortunately an increasing cost base coupled with a falling selling price means that production of Astaxanthin at the Selby site is no longer commercially viable.”
Tate & Lyle will help those colleagues potentially affected to seek suitable alternative employment. This will include the provision of on-site job shop facilities staffed by independent professional counsellors.
About Tate & Lyle
Tate & Lyle is a world leading manufacturer of renewable food and industrial ingredients. It uses innovative technology to transform corn, wheat and sugar into value-added ingredients for customers in the food, beverage, pharmaceutical, cosmetic, paper, packaging and building industries. The Company is a leader in cereal sweeteners and starches, sugar refining, value added food and industrial ingredients, and citric acid. Tate & Lyle is the world number-one in industrial starches and is the sole manufacturer of SPLENDA® Sucralose.
Headquartered in London, Tate & Lyle is listed on the London Stock Exchange under the symbol TATE.L. In the US its ADRs trade under TATYY. The Company operates more than 60 production facilities in 23 countries, throughout Europe, the Americas and South East Asia. In the year to 31 March 2007, it employed 6,900 people in its subsidiaries with a further 2,300 employed in joint ventures. Sales in the year to 31 March 2007 totalled £4.0 billion. Additional information can be found on http://www.tateandlyle.com.
SPLENDA® is a trademark of McNeil Nutritionals, LLC