ABF Seeks 51% of Illovo Sugar

NEW YORK - May 19/06 - SNS -- Associated British Foods PLC (ABF) has offered to pay 317 million pounds sterling or about U.S. $617 million for 51% of Illovo Sugar Limited's shares.

Illovo is the largest cane sugar producer in Africa and one of the world's lowest cost producers. It is the leading producer in South Africa, Malawi, Zambia and Swaziland and has a strong and growing presence in Tanzania and Mozambique. It produced 1.9 million metric tons (MT) of sugar in 2005-06 and has identified development programs to expand this capacity substantially.

According to a press statement accompanying the announcement, "The recommended offer carries the unanimous recommendation of the Illovo Board and the full support of the Illovo management team. ABF has received conditional undertakings to support this offer from the principal shareholders, either directly or through recommendations to their clients, accounting for 64% of Illovo's ordinary shares in aggregate.

"The directors of Illovo have said that they intend to vote their own shares in favor of the offer. The conditions of the recommended offer include obtaining regulatory approvals, Illovo shareholder approval and Court sanction of the scheme of arrangement."

Under the deal, Illovo shareholders will receive a consideration of Rand 21 per share in cash; Illovo will remain listed on the JSE and will retain its South African identity; the acquisition of shares is to be effected by way of a scheme of arrangement governed under South African law; ABF will have appropriate Illovo Board representation; and existing management team will continue and Don MacLeod will be asked to join the Executive Committee of British Sugar.