Yara Sees Purchases Within Months to Boost Fertilizer Sales

Yara International ASA, the largest publicly traded nitrogen-fertilizer maker, aims to complete asset purchases within the coming months as it pursues a 33 percent production increase in four years from 2010 levels.

“We are working on several growth opportunities,” Yara Chief Executive Officer and President Joergen Ole Haslestad said in an interview in Oslo today. “We do believe that we will be able to close some of them in the next months to come.”

Yara is among fertilizer producers seeking acquisitions as the cost of raw materials climbs and higher food prices spur farmers to increase plantings, boosting consumption of crop nutrients. World fertilizer demand is poised to rise 2.4 percent to a record in the 2013-14 season, the International Fertilizer Industry Association forecast in November.

Yara, which in December bought Bunge Ltd. operations in Brazil for $750 million, plans an 8 million metric ton increase in sales of its own and joint venture production between 2010 and 2016 from 24.5 million tons. The Oslo-based company’s growth plans include “significant” merger and acquisition activity, the company said in December.

“We are concentrating more on areas outside North America, due to the fact that North America is so difficult to buy something at an acceptable price,” Haslestad said.

Yara may buy the remaining stake in an Australian ammonia plant from U.S. energy producer Apache Corp., Haslestad said.

Quarterly Earnings

“Apache have signaled that they would like to sell their shares and we will be asked about it,” he said. Yara is “interested,” he said.

Yara posted net income of 2.17 billion kroner ($395 million) for the fourth quarter, down from 3.39 billion kroner a year earlier, it said in a statement today. That beat the 2.09 billion-krone average of 16 analyst estimates compiled by Bloomberg. Sales rose 6 percent to 20.9 billion kroner.

The stock closed 0.5 percent lower at 295.5 kroner in Oslo, having earlier gained as much as 1.3 percent, and giving Yara a market value of 85 billion kroner. More than 1.9 million shares changed hands, double the three-month average daily volume.

Yara, whose global fertilizer deliveries increased 19 percent in the fourth quarter from a year earlier, proposed a dividend of 13 kroner a share, compared with 7 kroner in 2011.

To contact the reporter on this story: Josiane Kremer in Oslo at jkremer4@bloomberg.net

To contact the editor responsible for this story: John Viljoen at jviljoen@bloomberg.net

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