Swedish agricultural cooperative Lantmännen has acquired Tate & Lyle’s oat ingredient business, which is based in Kimstad, Sweden.

As part of the deal, Lantmännen is acquiring an oat mill with a capacity of 55,000 tons and an oat ingredients manufacturing facility.

The purchased facility has around 35 employees and currently produces oat protein, beta glucan and oat flour. Completion of the transaction will take place on 29 March 2019.

Joan Braca, president of food and beverage solutions at Tate & Lyle, said: “We are pleased to reach this agreement with Lantmännen which represents a good outcome for our oat ingredient employees and customers and enables us to focus our business on serving our customers in our main food and beverage categories. We wish Lantmännen and its employees every success for the future.”

Lantmännen said the additional oats capacity will enable it to meet growing demand from customers in the Nordic food industry.

The company has three oatmeal mills in Sweden, Denmark and Norway, and markets food and ingredients based on oats to the food industry. It is currently pursuing research and innovation to develop new oat products.

Per Olof Nyman, CEO of Lantmännen, said: “Oats are a strategic investment area for Lantmännen and the further development of our oats business is a key part of our ‘Field to Fork 2030’ strategy.

“We are already strongly positioned in oats and this acquisition gives Lantmännen access to a modern mill that complements our existing production capacity within oats and creates a unique opportunity to develop and manufacture ingredients based on oats as the raw material.”

Once the acquisition has been completed, the facility will become part of the Lantmännen energy sector.

Magnus Kagevik, head of the energy sector at Lantmännen, said: “Lantmännen’s energy sector already has specialist expertise within the processing of wheat, and oat products will be an excellent complement to our current business.

“The acquisition enables Lantmännen to increase the production capacity of heat-treated oats significantly and gives us an opportunity to create added value within oat processing. It also creates synergies both within the energy sector and our other businesses at Lantmännen.”