Good Afternoon,
Following on from EMC steel to sugar, Real Good Food (RGD) has a buyer for sugar producer interested in Napier Brown. The proposed sale to Tereos Group (the French Cooperative sugar producer) is a positive for RGD.
RGD will be moving on with emphasis on the positively trending markets such as cake decoration, food ingredients and premium bakery. British Sugar have certainly missed an opportunity, although quite where the legal issues end is another question. Is the claim and associated potential awards transferred with the sale or retained (possibly in part) by RGD?
Being integrated with a sugar producer is the only way for Napier Brown to survive, as the sugar beet quotas are ending in two years (2017). Napier's best bet is with the cooperative model of Tereos, one hopes that RGD have put in some anti-competitive contractual terms to avoid Whitworths competing in RGD's key areas and offerings. With near zero debt/modest net cash, RGD's market reaction is justified now the debt has been shed, and the future looking sweet. One to watch...
Atb Fraser
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