Feb 28 (Reuters) - Tongaat Hulett, South Africa’s heavily indebted sugar producer, said on Friday it would sell its starch business to Barloworld for 5.35 billion rand ($351.10 million), including debt.
The company will use the proceeds from the sale to repay a portion of its debt, which it aims to cut by 8.1 billion rand by March next year.
Separately, Barloworld, a dealer for Caterpillar and other industrial equipment makers, said the starch business was highly cash generative, relatively asset light and a defensive investment.
Tongaat said earlier this month that it was in talks to sell the unit, Tongaat Hulett Starch (TSH), which, according to its website, is Africa’s largest producer of starch, glucose and related products.
Shares in South Africa-based Tongaat closed up 2.5%. ($1 = 15.2377 rand) (Reporting by Shanima A in Bengaluru; Editing by Anil D’Silva)