Mauritius outfit Omincane is to increase its stake in theReal Good Food Company (RGFC), which owns a portfolio of sugar, bakery and patisserie firms.
Omincane is paying 60p a share, a 9.1% premium to the closing price of RGFC on the trading day before the announcement, to increase its holding in the UK company to 20%, in a deal that will net RGFC £2.4m in funds. The proceeds will be used to reduce RGFC's borrowings.
Omnicane will get to appoint a representative to the board of RGFC and the two companies will explore joint venture opportunities in the future.
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Omnicane is the biggest sugar producer in Mauritius and one of the largest producers of refined white sugar amongst all African, Caribbean and Pacific nations.
Its interest in RGFC is the firm's Napier Brown division which is a major player in the sugar distribution business, offering Omnicane an important route to market.
For its part, Omnicane offers a low cost model for refining sugar, supported by the connected process of energy production.
Jacques D'Unienville, Omnicane Chief Executive Officer, said: "We have known Napier Brown and RGFC for a long time and are delighted to be now working together. Both businesses can learn from each other - with the impending changes in the sugar market, the timing couldn't be better."
RGFC shares had climbed 3% by 8:20.
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