The acquisition, according to Nordzucker, gives cane growers stability while opening up channels to reach the rapidly growing market in Southeast Asia.
Earlier this year, Nordzucker CEO Lars Gorissen said, “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.”
Grower-owned Mackay had been crippled by debt for years, according to ABC Australia, but Nordzucker – one of Europe’s leading sugar manufacturers – offered some security with its $42.5m equity plus up to $42.5m loan offer. That cash influx intended to support maintenance and capital expenditures to ensure efficiency and profitability.
Gorissen added that cane sugar production can be profitable at low prices ‘due to cost structures’ and expressed confidence in Mackay’s ability to turn positive earnings.
He described the most recent takeover negotiations as ‘constructive and trustful.’
Mackay operates three cane sugar factories in Queensland that produce 700k tons of raw sugar for Australian and international markets. Its 800 employees also manufacture white sugar, molasses and renewable energies.
Jochen Johannes Juister, chairman of Nordzucker’s supervisory board, explained that both companies benefit from being owned by growers themselves.
“Australia is a politically stable country and the local infrastructure is optimal,” he said. “[Our board] is convinced that the entry into cane sugar production and the investment in Mackay under the conditions set is a strategically correct step to make Nordzucker stable and competitive in the long term.”
Nordzucker, headquartered in Lower Saxony near Brunswick, Germany, employs 3,200 people on 18 production and refining facilities.