Yara International ASA has entered into an agreement to acquire Canadian nitrogen producer Saskferco for $1.6bn in enterprise value, strengthening Yara’s production and marketing position in North America and serving as a solid platform for further growth.
Through the transaction, Yara will acquire a world-class nitrogen manufacturing plant near Belle Plaine, Saskatchewan, in Canada and storage facilities in Saskatchewan and Manitoba.
The Saskferco plant is one of the world’s most gas efficient producers of ammonia, urea and UAN, with strategic proximity to western Canada’s large and cost competitive gas reserves. When completed, the deal will add 650,000 tonnes of ammonia, 980,000 tonnes of urea and 230,000 tonnes of UAN in annual production capacity.
In addition, current capacity expansion projects will increase ammonia and urea production to 725,000 and 1,115,000 tonnes annually from mid 2009 for an investment cost of $84m.
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