South Sugar: Acquisition and Delisting of Subsidiary CropEnergies

Last Updated: 27. Dezember 2023By

I hope you have all made it through the Christmas holidays safe and sound. Just before Christmas there was a stock with a price jump of around 70% in just one day. I’d like to look at this again for you. Appropriate to the theme of Christmas, gingerbread and speculoos, it will be partly sugary sweet today.

Takeover news triggers stock explosion The news about the stock explosion: „S├╝dzucker wants to take over CropEnergies completely“, „Takeover hammer before Christmas“…

First of all, for your information:

S├╝dzucker may be familiar to many. The product range of the European food company includes sugar, sweeteners, frozen products and various food ingredients. The corporate structure includes four business segments: sugar, specialties, CropEnergies and fruit.

CropEnergies belongs to the S├╝dzucker Group and is, measured by production capacity, a leading European producer of bioethanol – essentially biofuel. It is obtained by fermentation of sugar and starch-containing plants. CropEnergies‘ production sites are in Belgium, France, Germany and Great Britain. It has trading offices in the USA and Brazil. The headquarters is in Mannheim.

S├╝dzucker wants to take over daughter completely Last week came the news that S├╝dzucker plans a complete takeover of CropEnergies. For the biofuel producing daughter, S├╝dzucker wants to put 11.50 euros in cash on the table per share.

This caused a considerable stock jump of almost 70% to 11.50 euros. A trading day before, the CropEnergies papers had fallen to 6.75 euros, the lowest level since March 2020.

Experts welcome the step For market participants who commented on the report, a sensible plan. For S├╝dzucker, an end to the costly stock exchange listing of the bioethanol daughter makes absolute sense.

Dr. Niels P├Ârksen, head of S├╝dzucker, will keep CropEnergies as an independent pillar in the company. The delisting is intended to reduce both legal and administrative obligations that arise with listed companies, such as reducing costs and simplifying corporate structures.

S├╝dzucker shareholders also welcomed the measure with a positive stock reaction, which the stock desperately needed in view of its negative annual performance.

My conclusion for you S├╝dzucker CEO P├Ârksen wants to achieve a clearer capital market profile of the S├╝dzucker Group with the delisting as a logical step.

Strategically viewed, a round thing and an understandable step. Especially when you consider that the parent company had recently expressed an optimistic outlook on the company’s future prospects, while the daughter CropEnergies continued to show forecasts cuts and was generally rather negative.

Numerous analysts currently recommend buying the S├╝dzucker stock with targets of around 17.30 euros. Brave investors can of course speculate on a comeback at the current level.