Imperial Sugar and PureCircle have taken a swipe at beleaguered high fructose corn syrup by teaming up to produce a range of low-calorie, alternative sweeteners for food and drinks companies.

Shares in both companies jumped after they unveiled the 50:50 tie-up, Natural Sweet Ventures, which will sell sweeteners based on blends of Imperial's sugar and PureCircle's zero-calorie products refined from the stevia plant.

The products will be sold as alternatives high fructose corn syrup, which many food and drink companies have replaced with other sweeteners following claims – which the HFCS industry contests – that it is linked to health problems such as obesity and high blood pressure.

"They are being aimed first at the HFCS market," a spokesman PureCircle, which is based in the UK, told Agrimoney.com.

The campaign against HFCS has taken a higher profile since it was reported last year that Michelle Obama, America's first lady, had banned products containing the sweetener from the White House kitchen.

The risk of replacement with other sweeteners has prompted a difficult round of contract renewals among HFCS producers, such as Tate & Lyle, which analysts believe have been forced to accept large price reductions.

'First mover advantage' 

John Sheptor, chief executive at US-based Imperial Sugar , said that the joint venture would give the companies "first mover advantage", adding that the joint sugar-stevia range would provide an "attractive proposition" for customers seeking lower calorie sweeteners based on natural products.

However the PureCircle spokesman added that the deal would not stop the stevia group "going about its own business", which had already brought it contracts with drinks giants such as Coke and Pepsi.

Products containing sweeteners refined from stevia, a member of the chrysanthemum family, already account for 14% of the total US tabletop sweetener market, Nielsen data show.

'Big potential'

In the City, the tie-up was well received by Evolution analyst Alex Sloane, who restated a "buy" rating on PureCircle shares, with a price target of 300p.

"The involvement of Imperial Sugar, one of the largest sugar refiners and marketers in the Nafta region, adds further credibility to the claim that stevia is likely to become a mass-market ingredient over the medium term," he said.

At rival broker Westhouse Securities, analyst Barney Gray also restated a "buy" rating, saying: "This is very exciting news for PureCircle given that the upside potential from a wide range of new reduced calorie products across North America is huge."

Mr Gray added: "This joint venture model could also be rolled out across a number of other regions."

PureCircle shares closed up 4.6% at 238.5p in London.

In New York, Imperial Sugar shares closed 6.1% higher at $15.94.