Yara Boosts South American Growth With $425 Million OFD Purchase
Yara International ASA (YAR), the largest publicly traded nitrogen-fertilizer maker, said it agreed to buy OFD Holding Inc. from Omimex Resources Inc. for $425 million as it extends its expansion in South America.
The purchase, which includes production facilities in Colombia and distribution companies across Latin America, adds output of about 320,000 metric tons of compound NPK, 100,000 tons of calcium nitrate and 70,000 tons of ammonium nitrate, Yara said in a statement today. The transaction is expected to close in the second quarter, the Oslo-based company said.
“This deal marks a further step for our global growth ambition, adding almost half a million tons of upstream fertilizer capacity,” Chief Executive Officer Joergen Ole Haslestad said in the statement. The deal will “ improve our downstream positioning within the fast-growing cash-crop markets in the region.”
Yara, which in December bought Bunge Ltd.’s operations in Brazil for $750 million, earlier this year shelved a planned expansion of its Belle Plaine plant in Canada partly due to the high level of construction costs. Yara is also in talks with BASF SE, the world’s largest chemical maker, about setting up a joint venture to build an ammonia plant on the U.S. Gulf Coast.
Yara’s upstream operations convert natural gas and nitrogen into ammonia, which forms the basis for all nitrogen fertilizer.
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