Legal action dogs Tate & Lyle

Steve Dinneen
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TATE & Lyle (T&L) will announce its annual results tomorrow against the backdrop of a £100m legal dispute.

The conglomerate is embroiled in a complex court case with London-based firm Whitefox Technologies.

The two firms are suing each other in a spat that could cost the giant in excess of £100m if it loses.

There has also been a ruling that punitive damages could be made against T&L, which could bring the figure as high as £200m should it lose the case.

Despite involving two London firms, the action is being heard in the New York State Supreme Court because the dispute involves plants in the US.

T&L launched action against Whitefox in 2009 over membranes supplied to help reduce the environmental costs of ethanol production, with Whitefox launching a counter-claim.

The sensitive membranes were used to produce millions of gallons of ethanol in Loudon, Tennessee.

A Whitefox spokesman told City A.M.: “We can confirm that legal action is pending against Tate & Lyle. We will not be making any further comment until it has been completed.”

A T&L spokesman declined to comment yesterday.

Last month T&L announced that it had agreed to sell its Vietnamese sugar business in a cash deal worth £33m, subject to regulatory approval. The sale to a Vietnamese firm is part of the firm’s efforts to address its debt pile.