Jim Cramer highlighted Ingredion (NYSE: INGR) on Mad Money, calling it an overlooked consolidator after its $3.6 billion cash acquisition of Tate & Lyle. The stock is down 10% year-to-date, partly due to a weak quarterly report in early May, but Cramer believes the deal transforms Ingredion into a dominant force in food ingredients.
The Acquisition
Ingredion, which refines corn and starches into sweeteners, starches, and biomaterials, announced the Tate & Lyle purchase earlier this month. With a market cap of just $6.2 billion, the deal is substantial. Cramer noted that the market barely reacted, but he views that as a mistake, predicting Ingredion will become the most important company in its industry.
Market Reaction and Potential
While Ingredion's stock has declined this year, Cramer advises focusing on future prospects rather than past performance. The acquisition positions Ingredion to dominate the ingredients sector, offering flavors and textures for food and beverages. Despite current headwinds, Cramer sees significant upside from the merger.