Yara International grows further in South America with OFD Holding purchase
Yara International said it will be acquiring OFD Holding Inc in a USD 425 million deal. The seller is Omimex Resources Inc. According to data that was gleaned from Bloomberg, Yara International is an Oslo-based producer, distributor and seller of nitrogen-based mineral fertilizers and related products. Omimex Resources Inc is a privately-held independent energy and fertilizer firm that explores, develops, acquires and operates oil and gas properties as well produce and distribute fertilizers in countries worldwide, information gathered from its website said.
The acquisition will enable Yara International to extend its operations in South America. The deal will include production facilities located Colombia as well as distribution firms all over Latin America. It will increase the company's output of the NPK compound by 320,000 metric tons. It will also add 100,000 tons of calcium nitrate and 70,000 tons of ammonium nitrate to its output, Yara said. The firm expects to complete the deal in the second quarter.
In a statement, Yala International Chief Executive Officer Joergen Ole Haslestad said, "This deal marks a further step for our global growth ambition, adding almost half a million tons of upstream fertilizer capacity." He added that it will also enhance their downstream positioning with the region's fast growing cash crop markets.
In December, Yara purchased the Brazilian operations of Bunge Ltd in a USD 750 million deal. Bloomberg reported that Yara is also in discussions with the biggest chemical manufacturer around the world, BASF SE, about a joint venture. The potential partnership would be for the construction of an ammonia plant on the US Gulf Coast. Earlier this year, however, Yara did not push through with its plan to expand its Belle Plaine plant located in Canada. The high level of construction costs was cited as one of the reasons for the shelving, Bloomberg reported.