Germany-based Nordzucker, which is one of the leading sugar manufacturers in Europe, is acquiring a 70% majority stake in Mackay Sugar, Australia’s second-largest sugar producer. The deal will allow Nordzucker to build up production capacities outside Europe and further its strategy of focusing on sugar production from sugar beet and sugar cane.
The acquisition is subject to the approval of Mackay Sugar’s shareholders and other conditions precedent such as the sale of one of the four Australian sugar factories. Nordzucker will contribute equity capital of Au$60 million (€38 million) for the 70% stake. Mackay Sugar will also receive an additional shareholder loan of up to Au$60 million. The equity and debt capital contribution will mainly be used for maintenance and capital expenditure in order to significantly increase the availability of the three remaining plants with an annual production capacity of about 700,000 tonnes of sugar over the next few years and make the company sustainably profitable.
“The growth in sugar is taking place in regions outside the EU. By acquiring a stake in Mackay Sugar, we can secure a substantial share of the Australian market and gain access to the Southeast Asian market,” explains Dr Lars Gorissen, chairman of Nordzucker’s executive board. “Cane sugar production is profitable even at lower sugar prices due to cost structures. We are convinced that Mackay Sugar with its investments in the plants will be able to make in the medium term a sustained positive contribution to group earnings.”