By Kristine Henry, Sun Staff. Originally published November
7, 2001 in The Baltimore Sun
The acquisition of Domino Sugar by two Cuban exiles who rebuilt their sugar
empire in the United States after fleeing Castro's regime was finalized
yesterday.
Florida Crystals Corp. of West Palm Beach, owned by Alfonso and J. "Pepe"
Fanjul, will control 64 percent of the operation and the Sugar Cane Growers
Cooperative of Florida, a group of 56 growers in Palm Beach County, will control
the rest. The two parties are paying between $165 million and $185 million for
Domino, depending on the refiner's performance.
No layoffs of Domino's 500 employees are expected at the 79-year-old Inner
Harbor plant, whose 120-foot red neon sign has warmed the Baltimore skyline for
five decades.
"We are proud to have acquired such a widely recognized and
well-established consumer brand," said Alfonso Fanjul, 64, chairman and
chief executive officer of Florida Crystals. "Integrating the established
expertise of Florida Crystals and [the cooperative] with the brand strength and
refining capacity of Domino provides a unique industry opportunity that we look
forward to capitalizing on."
The Domino brand - and sign - will remain intact and the Baltimore plant,
along with Domino facilities in Brooklyn, N.Y., and Chalmette, La., will become
part of the American Sugar Refining Co., which will also include Refined Sugars
Inc., of Yonkers, N.Y. The Yonkers facility was already owned by Florida
Crystals and the cooperative. The combined operation is expected to have annual
sales of more than $1 billion.
Florida Crystals is one of the country's dominant sugar-cane growers with
180,000 acres. It produces 750,000 tons of raw sugar every year and accounts for
about 40 percent of the cane grown in Florida, and more than 9 percent of the
country's cane sugar.
The Domino acquisition means the Fanjuls can more effectively control every
facet of the sugar business, from planting and harvesting to refining, packaging
and distribution. The brothers are fourth-generation sugar growers who were
among Cuba's wealthy elite before Fidel Castro toppled the Batista regime and
began confiscating private property. The family fled in 1959 and settled in New
York, where they were part-owners in a sugar brokerage company, before moving to
Palm Beach and starting a new sugar empire from scratch. Their holdings, which
include sugar fields and a luxury resort in the Dominican Republic, now exceed
what they had in Cuba.
Intensely active in politics, they are beneficiaries of the federal
government's sugar price support program that keeps prices in the United States
at least double what they are on the world market.
Cane refiners say the sugar program has been a boondoggle because it means
sugar cane and sugar beets are such attractive crops that farmers grow too many
of them. In particular, there has been a glut of sugar beets - which are simpler
to process than cane - on the market in recent years.
The high sugar-beet supply means prices for the finished product - from cane
and beets - have fallen and refiners such as Domino have been losing money on
every pound of sugar they sell. Domino's former owners, Tate & Lyle of
London, pointed to the price supports as one of the main reasons they were
selling the refiner.
"The closing of the Domino Sugar transaction will allow us to further
vertically integrate our business," said Pepe Fanjul, 57, vice chairman,
president and chief operating officer, "as well as ensure that our
customers have a reliable supply of refined sugar and other sugar-related
products."
Copyright © 2001, The Baltimore Sun | 
