South Africa’s Illovo Sugar said on Friday its largest shareholder, Associated British Foods , has agreed to buy the remaining stake in the company for 5.6 billion rand (€325 million).

AB Foods, which holds a 51.35 per cent stake in Illovo, has made an offer of 25 rand (€1.45) per share for the stake it does not own, Africa’s top sugar producer said in a statement. Illovo, which has been cutting costs to survive low sugar prices, said AB Foods plans to fund the offer from its cash resources and existing facilities.

AB Foods first announced its intentions in February to buy the rest of Illovo Sugar for about 4.1 billion rand.

Illovo’s shares surged more than 18 per cent at 24.24 rand, their highest level in a year and on course for their biggest daily gain since 1994.