Kauai-based Gay & Robinson Inc. said today it is exiting the sugar business and is moving forward with negotiations to lease its sugar mill and other assets to an ethanol-producing company.

Gay & Robinson said it will "continue to honor its contractual obligations to its workers" on Kaua'i, and will be meeting with local union officials to discuss the transition.

"The company is moving forward in its continuing negotiations for Pacific West Energy LLC to continue its plans for ethanol and energy development at the Kaumakani Plant," Gay & Robinson said in a news release.

Gay & Robinson also said it is working on plans to lease some its agricultural lands to farmers.

The closure of Gay & Robinson leaves Alexander & Baldwin as the only sugar producer in the state.