Csr Buys 20pc Of Broker

Sydney Morning Herald

Tuesday December 10, 1991

By JOHN SEVIOR and wire services

Building materials group and sugar leader CSR has acquired 20 per cent of the London-based sugar broker Czarnikow for an undisclosed sum.

CSR deputy managing director Mr Bill Bennett described the investment as"relatively modest".

There had been speculation CSR was considering buying a stake in Czarnikow for several weeks, with rumours the 100-year-old firm had been in some financial difficulty.

Mr Bennett said: "From CSR's perspective it is a defensive investment made for the purpose of ensuring the continued availability of Czarnikow's services for the Queensland sugar industry.

"They came to the view that the long-term viability of the business would be best secured by separating sugar and having major sugar producers as equity participants."

Czarnikow Sugar is 65 per cent-owned by Czarnikow Holdings, a commodities broker, and 15 per cent-owned by the UK group Berisford International Plc.

Czarnikow Sugar was formed from the former sugar broking business of Czarnikow Holdings. It is one of the world's biggest sugar research houses.

At about US9c a pound the world sugar price is up from its low of about US8c a pound but well down on recent highs of more than US12c a pound.

The price fall has had a big effect on CSR's earnings although the company said recent rains in north Queensland would provide a big boost to this year's crop.