Sulfate of Potash (SOP) and salt producer Compass Minerals, Overland Park, Kan., has acquired Big Quill Resources Inc., Canada’s leading SOP producer, in an all-cash transaction valued at C$56 million (US$56.3 million), subject to customary post-closing adjustments. Located on Big Quill Lake near Wynyard, Sask., Big Quill produces high-purity SOP for non-agricultural specialty applications, as well as for nutrients used by growers of high-value crops and turf.
“Big Quill is an innovative, entrepreneurial business with unique production capabilities, technical expertise, and non-seasonal applications that will both broaden and strengthen Compass Minerals’ specialty fertilizer segment,” said Angelo Brisimitzakis, Compass Minerals president and CEO. “We expect this acquisition to be immediately accretive. In addition, we plan to expand Big Quill’s production and sales of high-value, specialty products over time.”
The Wynyard site, with an annual capacity of approximately 40,000 st, produces much of its SOP by extracting naturally occurring sulfate from the brine of Big Quill Lake and combining it with potassium chloride purchased through a very long-term, advantaged supply agreement. Big Quill’s 2010 revenues are expected to be approximately C$23 million, with EBITDA of approximately C$7 million. Compass Minerals funded the purchase with cash on hand.
All of Big Quill’s some 35 employees will remain with the company, as will management, including company leader Dennis Puff.
Big Quill’s operations began in the early 1980s as a pilot facility for Potash Corp. of Saskatchewan Inc. Management acquired the facility in 1991.
Compass Minerals’ existing SOP unit, Great Salt Lake Minerals Corp. (GSLM), has been operating on the shores of the Great Salt Lake near Ogden, Utah, since 1970. GSLM has been increasing its capacity and expects to produce up to 350,000 st/y of SOP in 2011, up from 300,000 st/y in 2010. Capacity expansion is expected to continue over the next few years, reaching 550,000-570,000 st/y in 2015.