Cristal Union to acquire Vermandoise for $1.3bn

French sugar cooperative Cristal Union has agreed to acquire Vermandoise in a deal valued at nearly €1bn ($1.3bn), which would create France’s second largest sugar group.

Under the agreement, Cristal Union will acquire the whole of Vermandoise and its subsidiary Société Sucrière de Pithiviers Le Viel (SSPLV).

The deal includes a 51% stake in Vermandoise, which is owned by the Delloye family and has a market capitalisation of €262m ($348.93m), Reuters reported.

Vermandoise owns 56.5% of SSPLV, whose market value is €472m ($628.61m).

If cleared by competition authorities, Cristal Union will then initiate a buyout offer for the rest of Vermandoise’s shares at €3,487.30 ($4,644.39) per share, and for the rest of SSPLV shares at €1,692.76 ($2,254.42) per share.

The acquisition is fully funded by Crédit Agricole Nord Est and Crédit Agricole Corporate and Investment Bank.

Cristal Union is a cooperative representing 5,350 farmers, and it produces 800,000t of sugar and 4.5 million hectolitres of alcohol a year from 11 sites.

Groupe Vermandoise produces 550,000t of sugar and 600,000 hectolitres of alcohol a year from four sites.