PURE.L Regulatory News (PURE)

6 May 2008 08:33

PureCircle Limited06 May 2008 PureCircle Limited ("PureCircle" or "the Group") Kenya Joint Venture PureCircle enters into agreement with James Finlay Limited ("Finlay") fordevelopment of stevia plantations and construction of extraction plant in Kenya("PureCircle Kenya Projects") PureCircle announces that it has entered into a joint venture agreement withFinlay for the long term development of stevia plantations and the building ofan extraction plant in Kenya. In line with PureCircle's commitments regardingthe proceeds from its recent AIM listing, the Group has committed US$20 millionto the PureCircle Kenya Projects of which an estimated US$15 million has beenallocated to the crude stevia extraction plant and the balance to theplantations and associated working capital. PureCircle and Finlay have established a Kenyan registered company ("JVCo") asthe operating entity for the PureCircle Kenya Projects. JVCo will undertake boththe plantation activities and the construction of the extraction plant. PureCircle will initially have a majority shareholding in JVCo which will ownthe extraction plant. An option has been granted to Finlay to eventuallyincrease its holding in JVCo to 51%. PureCircle will be building new refinerieswhich shall be wholly-owned by PureCircle to fully refine extracts derived fromJVCo's capacity. This arrangement is line with PureCircle's business model ofmaintaining control over refining and market whilst partnering with companiesthat have expertise in plantation and extractions. Pursuant to a supply arrangement between PureCircle and JVCo, PureCircle willhave exclusive rights to acquire all stevia extracts and / or dry stevia leavesproduced by JVCo for a period of seven years with renewable options thereafter. Finlay is a globally integrated company whose principal activities comprises thegrowing, manufacture and distribution of tea, and tea-related products, flowersand vegetables. The company is also involved in other agricultural activitiesincluding rubber and timber and has a range of trading and services businessescovering logistics and the provision of agency services. Finlay's teaplantations in Kenya, Uganda, and Sri Lanka are regarded as being some of thehighest quality in the world. PureCircle, the world's largest supplier of high purity Reb-A, regards the jointventure agreement as a major strategic initiative. As such, it is key tomaintaining the Group's first-mover advantage in the natural high intensitysweetener industry as well as strengthening its supply chain and improving itsgeographical risk profile. Commenting on the agreement, Magomet Malsagov, Managing Director of PureCircle,said: "We are delighted to have established this joint venture with Finlay.PureCircle will have access to, and benefit from, Finlay's extensive plantationexperience and management expertise in Kenya, established over 80 years ofoperation in the country. "The plantations and extraction plant, which will provide PureCircle with aneffective standalone supply chain, separate to our existing operations in Asia,will significantly increase our capacity to meet prospective demand and,thereby, reinforce our market leading position." 6 May 2008 EnquiriesPureCircle Limited +60 1 23888 049Magomet Malsagov, Managing Director CollegeHill +44 20 7457 2020Mark GarrawayRobert Pugsley RFC Corporate Finance Ltd (Nomad) +61 8 9480 2500Stephen Allen This information is provided by RNS The company news service from the London Stock Exchange