Tate & Lyle’s agreement to a £2.7bn takeover by Ingredion is not simply a deal. It is the latest chapter in a long, dispiriting story about what London has become.
Dear reader,
Tate & Lyle agreed to a £2.7 billion all-cash takeover by Ingredion, an Illinois-based food and beverage ingredients company. The offer stands at 595 pence per share, rising to 615 pence including permitted dividends. The board has unanimously recommended it. Barring the usual regulatory formalities, it will pass.
And with it, Tate & Lyle’s 87-year listing on the London Stock Exchange comes to an end. Eighty-seven years! The company was incorporated in 1903, and traces its commercial roots to Victorian sugar refiners Henry Tate and Abram Lyle, whose businesses merged in 1921. It is, or rather was, the last surviving member of the original FT-30 index still trading publicly in London, the benchmark that preceded the FTSE and was meant to represent the enduring backbone of British industry. Every other name on that original list has been absorbed, restructured, or wound down. Now the final one is heading west.
2 yr share price chart
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A brief history
The two founding businesses could hardly have had more different origins. Henry Tate, a Liverpool grocer turned sugar merchant, built his fortune refining cane sugar and had the good sense to patent cube sugar in 1872, transforming how households bought and stored it. He also gave London the Tate Gallery. Abram Lyle, a Scottish shipowner and cooper, moved into sugar refining on the Clyde and later the Thames, and somewhere along the way devised the golden syrup that still sits in millions of British kitchen cupboards, the tin unchanged for over a century. The two families had long competed. Their businesses merged in 1921, not entirely warmly, and Tate & Lyle was listed on the London Stock Exchange in 1939, the year the FT-30 itself was created.
For much of the 20th century the company was synonymous with British sugar refining, at its peak processing around half the world’s sugar. But the strategic pivot away from commodities began in earnest in 2010, when it sold its European sugars operations to American Sugar Refining for £211 million, retaining only a minority stake which it later divested entirely. What remained, and what has been steadily developed since, is a specialty ingredients business with a very different character.
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What the business actually does today
The customer base spans food and beverage manufacturers across more than 120 countries. Revenue for the year to March 2026 came in at just over £2 billion, with operating profit of £180 million. The business is not glamorous, but it is embedded in the supply chains of companies that make products consumed daily by billions of people, and that stickiness is precisely what attracted a buyer.
A company mid-transformation
The strategic logic behind the pivot was sound. Food and beverage companies face genuine pressure to reformulate products, cutting sugar content, adding fibre and protein, improving nutritional profiles without sacrificing texture or taste. Tate & Lyle positioned itself squarely in that gap, and the 2024 acquisition of CP Kelco, a pectin and hydrocolloid specialist, substantially expanded the portfolio. The problem, as tends to happen with businesses caught mid-transformation, is that near-term trading was uninspiring. North American volumes were weak. In February, the company guided for low single-digit falls in both revenue and earnings for the full year. The shares, which had traded above 800 pence in 2022, drifted to around 345 pence as recently as last autumn. The discount to intrinsic value became uncomfortable, and visible to anyone paying attention.
Ingredion, watching from Westchester, Illinois, was paying attention.
The negotiation
What is notable about this deal is how it was won. Ingredion did not arrive with a knockout first offer. The initial unsolicited proposal was pitched at 530 pence per share, structured as 80% cash and 20% Ingredion stock. The Tate & Lyle board rejected it. Ingredion returned four more times before the parties agreed on an all-cash offer at 595 pence. In doing so, the board extracted both a higher price and a cleaner structure. No stock component means no exposure to Ingredion’s own valuation risk. That is a reasonable outcome for shareholders, even if the premium only looks generous measured against a share price that had been materially depressed.
At 595 pence, the deal values the business at roughly 8.8 times adjusted EBITDA on a trailing basis. That is not an extravagant multiple for a specialty ingredients company with genuine long-term demand tailwinds. A more aggressive trade buyer or a private equity consortium might have pushed higher. But Tate & Lyle was not negotiating from a position of strength, and after five rounds of talks, 595 pence was likely close to Ingredion’s ceiling. The combined group will generate approximately $9.9 billion in annual revenue and around $1.8 billion in adjusted EBITDA.
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The broader problem
But the Tate & Lyle deal is not really about Tate & Lyle. It is about what London has become.
By the time Drax’s offer for Bluefield Solar was announced last week, the total value of announced UK takeovers in 2026 had reached £39.3 billion, already comfortably surpassing the £29 billion recorded across the whole of 2025. There have been 28 announced deals this year, more than one per week. Foreign acquirers account for around 86% of total deal value, the highest share on record, with US buyers representing roughly half of all foreign approaches. The average premium paid has been 45%. These are not the numbers of a healthy, self-confident market. They are the numbers of a market being picked off.
The reason is not difficult to identify. UK-listed companies have traded at a persistent and widening discount to US and European peers for the better part of a decade. A combination of post-Brexit uncertainty, an institutional base that has steadily reduced its domestic equity exposure, a retail investor culture that has historically underweighted UK equities, and a listed company ecosystem that has struggled to compete with the liquidity and valuations available in New York has left large parts of the London market chronically undervalued. Foreign strategic buyers, with access to cheaper capital and higher re-rating potential after acquisition, are simply doing the arithmetic.
Notable UK foreign takeovers, 2024 to 2026
The worry is not simply the loss of any individual company. Businesses change hands, and shareholders in Tate & Lyle are receiving a substantial and clean premium in cash. Many will be perfectly content. The worry is structural. Each departure reduces the depth and diversity of the London market. Each deal won at a 40-60% premium to a depressed share price reinforces the message that UK equities are cheap on an absolute basis, and that the market will not correct that cheapness on its own. The premium paid is not a sign of London’s health. It is a measure of how far the discount has become embedded.
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There is a harder question lurking behind all of this. At what point does a market with a shrinking listed universe, an ageing institutional base, and a structural valuation discount reach a tipping point from which recovery becomes genuinely difficult? London is not there yet. But the direction of travel is not encouraging, and Tate & Lyle’s departure, the last original FT-30 name gone, feels like more than a footnote.
For what it is worth, the Ingredion deal looks well-structured on its own terms. The combination makes industrial sense. Tate & Lyle’s European and Asian customer relationships complement Ingredion’s North American strength. The shared focus on reformulation, sugar reduction, and functional ingredients gives the merged group a coherent identity. If the combined entity is well run, the business that leaves London may actually flourish under new ownership.
That is the frustration. The assets are good. The people are capable. The strategic rationale is clear. The only thing that did not work was the market in which Tate & Lyle happened to be listed, the market that priced the business at 345 pence when it was worth considerably more, and then watched as an American company arrived to do the arithmetic.
The PM I worked for used to own this stock and rode it all the way down, refusing to recognise it became a value trap.
What do you think eroded its key competitor advantages over time? I didn’t really believe it had a competitive moat, nor pricing power.