Wilmar inks JV with Tereos for corn starch business expansion

It will be a 51:49 venture.

In a release, the Tereos Group, which sealed a partnership with the Wilmar group in 2011 for wheat-based starch and derivatives production, is announcing today the extension of this partnership to corn and potatoes, together with the acquisition of a stake in a corn starch facility which will be operated in a joint venture with Wilmar.

The starch unit located in Tieling, northern China (Liaoning Province), with a current annual processing capacity of 700,000 tons of corn, will be jointly controlled (51% Wilmar / 49% Tereos) in line with the existing partnership agreement for the Chinese market. The acquisition is subject to receipt of
regulatory approvals, including merger clearance.

“The investment in the Tieling starch facility represents a major step forward in our partnership with the Wilmar group and will enable us to produce from 2014 a range of starches based on both wheat and corn, meeting a wider range of needs for our customers on the Chinese market”, declared Alexis Duval,
Tereos’ Chief Executive Officer.

Tereos will bring its expertise in corn-based starch and starch-derivatives production, built up over more than 15 years of operation in its European facilities, such as Marckolsheim (France) and Saragossa (Spain). In addition, the Group has launched the construction of a corn starch facility in Palmital, Brazil.

In 2011, with the acquisition of the Haussimont and Palmital facilities, respectively in France and Brazil, Tereos also expanded its technological expertise to include starch production using potatoes and manioc.

In China, a further industrial project under the Wilmar-Tereos partnership involving the construction of a wheat starch facility in Dongguan, near Guangzhou, will be operational during the first half of 2014. This unit will have the capacity to process 500,000 tons of wheat to produce starch, glucose syrups and
gluten.

Since 2010, China has become the world's leading market for starch, ahead of the United States, accounting for 30% of global consumption. The consumption of isoglucose in China has increased four times in the past six years, climbing to 11% of all sugar consumed.