Acron has announced the sale of its subsidiary holding a 50.5 percent interest in China’s Hongri Acron to an independent Hong Kong-based investment holding company.
The Shandong Province-based Hongri Acron produces complex fertilizers for the Chinese market, with three NPK production lines with an aggregate 800,000 mt/y capacity. Hongri Acron recorded a negative EBITDA of RUB 400 million in the first quarter of this year and a negative EBITDA of RUB 803 million in full-year 2015. Lengthy repairs have been ongoing at the operation impacting both production and sales.
“In line with Acron Group’s long-term development strategy, we decided to sell our stake in the Hongri Acron plant in China and focus on further development of our Russian production assets,” said Alexander Popov, Acron board chairman.
“Nevertheless, China has been and will remain our key partner and a priority market to sell our products outside Russia. For this reason, Acron Group will maintain its strong presence in China turning our efforts to advancing the local distribution network Yong Sheng Feng, which has been successfully selling Russian fertilizers under the Acron brand in the Chinese market for eight years.”
Acron did not disclose any financial details of the transaction.