Yara International ASA said Oct. 30 that it has acquired the Mexican fertilizer company Olmeca from Sociedad Quimica y Minera de Chile S.A. (SQM). SQM said the sale involved a payment of US$4.9 million, which will have a before-tax positive effect of about $1.1 million.
Olmeca had sales of 160,000 mt of fertilizers in 2005. Yara considers it an ideal vehicle to drive Yara’s market position in Mexico. Yara says Olmeca has an established commercial organization with strong presence in the market through its network of rented warehouses and sales outlets. Olmeca has a 4 percent total domestic market share and a 9 percent market share in the central region of Mexico, where it is most active. Olmeca has established a leading position in the specialty fertilizer segments for both fertigation and dry applied products. Total revenues exceeded $50 million in 2005.
“Mexico is the fourth largest fertilizer market in the Americas after the USA, Brazil and Canada,” said Yara President and CEO Thorleif Enger. “The acquisition of Olmeca contributes to strengthening Yara’s position in the Mexican fertilizer market and creates a strong foundation for increased sales to the cash crop segment.”
SQM said when it bought Olmeca in 1997 that there were no reliable distribution channels for fertilizer in Mexico, and that Olmeca was needed to introduce and to increase sales of SQM products. Today, SQM said that less than 25 percent of SQM’s specialty plant nutrients are sold in Mexico via Olmeca, and that the company is no longer a key distribution channel for SQM products.