Byron Thompson, managing director of the Seprod Group of companies. - File

Seprod Limited and partner Fred M. Jones Estate will be injecting some US$5 million (J$445 million) initially into the sugar assets just acquired from Government, and pay another US$82,200 per year to lease cane lands in St Thomas.

The partners in the St Thomas Sugar Company (STSC) paid US$500,000 to acquire the assets and are expected to take possession on July 16.

"The idea now is to get the sugar mill running efficiently, as well as the cane cultivation practices, so that the cane have good yield," said Byron Thompson, chief executive officer and managing director of the Seprod Group of Companies.

Seprod handled the acquisition through a newly created subsidiary, Golden Grove Sugar Company, its holding vehicle for 55 per cent of the STSC. FM Jones owns the other 45 per cent.

Shared investment

The investment in the lands and rehabilitation of the factory are shared according to the equity stake held by each partner, Thompson said.

The US$5 million to be spent on the factory is to deal with repairs and upgrades to cane-yard equipment, overhauling of the milling equipment inside the factory, broilers and processing equipment.

"These are only some of the things we are going to do over the short to medium term," Thompson explained, adding that the company would stay with sugar production for now.

"We have no immediate plans to go into distillery or other by-products production," he said.

Other bidders have announced plans to produce ethanol.

Fred M. Jones is known as a big landholder and is into farming.

Seprod is involved in agriculture as a dairy farmer, but is chiefly a manufacturer and distributor of industrial products, edible oils and fats, beverages, and other household consumer products.

Manufacturing accounts for the bulk of the company's revenue, bringing $7.7 billion last year, while distribution of consumer goods contributed $3.7 billion to total revenue.

The new sugar factory is surrounded by 10 to 12 hectares of land, and the partners have leased another 1,551 hectares at US$53 per hectare per year.

50-year lease

The price will hold for the first five years of a 50-year lease agreement that Seprod/FM Jones can extend another 25 years under the contract struck with Government.

The new owners, when they assume control next week, plan to do so with much of the current staff in place.

"Most people naturally will continue, so Seprod will manage with the present management team," Thompson said.

"What we will work towards is to maximise output of the plant."

He said the target for now is to do 20,000 tonnes of sugar per crop.

sabrina.gordon@gleanerjm.com