Tate & Lyle is considering the sale of its European starch operations.

The group said that following the new EU sugar regime, the business was “no longer an essential element of its strategy to focus on value added ingredients”.

Iain Ferguson, chief executive of Tate & Lyle, said: “The decision to explore a full or partial disposal is in response to the consequences of far reaching reform to the EU sugar regime.”

The news was welcomed by analysts, with shares in Tate & Lyle climbing 29p to finish on 801p yesterday.