Corn Products International Enters Into Definitive Agreement to Acquire Food Business of SPI Polyols and Remaining 50 Percent of
January 11 2007 - 8:32AM
PR Newswire (US)
Accretive SPI Acquisition Strengthens Sweeteners Platform,
Highlights Strategy to Expand Value-Added Ingredients Portfolio in
Growth Markets WESTCHESTER, Ill., Jan. 11 /PRNewswire-FirstCall/ --
Corn Products International, Inc. (NYSE:CPO) announced today that
it has entered into a definitive agreement with SPI Polyols, Inc.,
a subsidiary of ABF North America Holdings, Inc., to acquire the
food business of SPI Polyols and the shares of an SPI unit that
holds the remaining 50 percent of Getec Guanabara Quimica
Industrial S.A., or Getec, in Brazil. Financial terms were not
disclosed. The combined businesses are expected to have annual
sales of nearly $100 million. The pharma business of SPI is not
included in the transaction and will continue to be operated by
SPI. The transaction is expected to be accretive in the first year
to Corn Products International's earnings per share and meet the
Company's stated target for return on capital employed (ROCE) of 8
1/2 to 10 percent. "This acquisition will strengthen our sweeteners
platform and reinforce our Pathway strategy to expand our
value-added, specialty product portfolio and become a broader-based
ingredients company," said Sam Scott, chairman, president and chief
executive officer of Corn Products International. "The acquisition
also would make us a leading producer of polyols in Latin America
with facilities in Brazil, Mexico and Colombia, and would allow us
to enter the US and Canadian markets primarily as a specialty
polyols supplier." The food business of SPI Polyols produces and
sells specialty polyols, including crystalline sorbitol,
crystalline maltitol, mannitol, specialty liquid polyols and liquid
sorbitol for the food, beverage, confectionary, industrial,
personal and oral care, and nutritional supplement markets. Polyols
are sugar-free, reduced calorie sweeteners primarily derived from
starch. Getec is a major Brazilian producer of polyols, including
liquid sorbitol and mannitol, and anhydrous dextrose, for the
personal care, food, candy and confectionary, and pharmaceutical
markets. In September 2006, Corn Products International increased
its equity ownership in Getec to 50 percent from 20 percent. The
proposed transaction, which has been approved by Corn Products
International's Board of Directors, is subject to customary closing
conditions. Closing is anticipated in the first quarter of 2007.
DEMSA Acquisition Completed Separately, Corn Products International
confirmed that its wholly owned Argentinean subsidiary, Productos
de Maiz, S.A., has acquired DEMSA Industrial Peru - Derivados del
Maiz, S.A., or DEMSA, the only corn refiner in Peru. Established in
1964 and with annual revenues of approximately $15 million, DEMSA
sells regular and modified corn starch, glucose, grits, corn oil,
corn flour, hominy feed, caramel color and other products to the
food and beverage, papermaking, corrugated, pharmaceutical,
textiles and animal feed markets. "We believe DEMSA will be
especially helpful to the overall performance of our Andean region
and, along with Getec, enhance our historically strong market
position and extensive territory coverage in South America," said
Scott. About the Company Corn Products International is one of the
world's largest corn refiners and a major supplier of high-quality
food ingredients and industrial products derived from the wet
milling and processing of corn and other starch-based materials.
The Company, headquartered in Westchester, Ill., is the number-one
worldwide producer of dextrose and a leading regional producer of
starch, high fructose corn syrup and glucose. In 2005, Corn
Products International recorded net sales of $2.36 billion with
operations in 15 countries at 33 plants, including wholly owned
businesses, affiliates and alliances. For more information, visit
http://www.cornproducts.com/ . Forward-Looking Statement This news
release contains or may contain forward-looking statements within
the meaning of Section 27A of the Securities Exchange Act of 1933
and Section 21E of the Securities Exchange Act of 1934. The Company
intends these forward looking statements to be covered by the safe
harbor provisions for such statements. These statements include,
among other things, any predictions regarding the Company's future
financial condition, earnings, revenues, expenses or other
financial items, any statements concerning the Company's prospects
or future operation, including management's plans or strategies and
objectives therefor and any assumptions underlying the foregoing.
These statements can sometimes be identified by the use of forward
looking words such as "may," "will," "should," "anticipate,"
"believe," "plan," "project," "estimate," "expect," "intend,"
"continue," "pro forma," "forecast" or other similar expressions or
the negative thereof. All statements other than statements of
historical facts in this release or referred to in this release are
"forward-looking statements." These statements are subject to
certain inherent risks and uncertainties. Although we believe our
expectations reflected in these forward-looking statements are
based on reasonable assumptions, stockholders are cautioned that no
assurance can be given that our expectations will prove correct.
Actual results and developments may differ materially from the
expectations conveyed in these statements, based on various
factors, including fluctuations in aggregate industry supply and
market demand; general political, economic, business, market and
weather conditions; fluctuations in the value of local currencies,
energy costs and availability, freight and shipping costs, and
changes in regulatory controls regarding quotas, tariffs, duties,
taxes and income tax rates; operating difficulties; the risk of
expropriation; labor disputes; genetic and biotechnology issues;
changing consumption preferences and trends; increased competitive
and/or customer pressure in the corn-refining industry; and the
outbreak or continuation of serious communicable disease or
hostilities including acts of terrorism. Our forward-looking
statements speak only as of the date on which they are made and we
do not undertake any obligation to update any forward-looking
statement to reflect events or circumstances after the date of the
statement. If we do update or correct one or more of these
statements, investors and others should not conclude that we will
make additional updates or corrections. For a further description
of these risks, see Risk Factors included in our Annual Report on
Form 10-K for the year ended December 31, 2005 and subsequent
reports on Forms 10-Q or 8-K. DATASOURCE: Corn Products
International, Inc. CONTACT: Investors, Dave Prichard,
+1-708-551-2592, or Media, Mark Lindley, +1-708-551-2602, both of
Corn Products International, Inc. Web site:
http://www.cornproducts.com/
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