UK: Tate & Lyle shares drop as sucralose alternative emerges
Tate & Lyle announced yesterday (14 February) that the company is looking into the sale of a tabletop sweetener, Altern, in some US Wal-Mart stores.
In a statement, the sugar and sweetener company said: "Tate & Lyle has analysed samples of this product and believes it to contain an active ingredient of Chinese origin. Work is being carried out to determine if this ingredient meets the stringent US Food and Drug Administration specifications and or infringes on Tate & Lyle's intellectual property."
Tate & Lyle have thus far successfully defended its patents on sucralose sweetener sold under the Splenda brand name. Were Altern to be a viable alternative to Splenda, it could represent a serious setback for Tate & Lyle which has invested heavily in the development of the artificial sweetener to offset declining sugar prices and appeal to health conscious consumers.
Slenda, a leading low-calorie sweetener internationally, is a highly lucrative product accounting for 4% of Tate & Lyle sales and 22% of the company's profits. Despite the company's attempts to downplay the possible impact of Altern, immediately following the announcement share prices fell by 12.5 pence to 604 pence.
"Tate & Lyle does not expect the launch of this product, even were it to be on a national scale, to have any material effect on the results of its sucralose division," the company said.
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