EuroChem Group AG, Zug, Switzerland, confirmed that it is evaluating a proposal for indebted nitrogen fertilizer and methanol producer Ammoni in Russia’s Tatarstan Republic, according to a Bloomberg report, but said it is too early to comment further.
It is understood to be one of two companies eyeing Ammoni, Russia’s Kommersant business daily, citing undisclosed sources, reported early this week. Russian oil major Lukoil is reported to be the other interested party. Others, reportedly including Uralchem, were said to have shown some earlier initial interest in the Ammoni assets.
Both EuroChem and Lukoil are said to be offering $1 billion for the Tatarstan-based producer, although the nature of the deal is unclear.
Ammoni’s shareholders are understood to have been looking for an investor for some time, and also have considered selling the entire company, according to the sources cited by Kommersant. Russian state-owned development bank VEB.RF, which holds a 22.8 percent interest in Ammoni, is reportedly owed RUB100 billion (approximately $1.5 billion) by the company.
Ammoni, based at Mendeleevsk, approximately 1,000 km east of Moscow, was established in early 2016 to operate newly-launched production facilities, and evolved out of nitrogen producer Mendelyeevskazot LLC. Ammoni has nameplate capacity of 715,000 mt/y of ammonia without methanol production or 487,300 mt/y of ammonia with integrated production (and 233,800 mt/y of methanol), 717,500 mt capacity for granular urea, and 380,000 mt/y for ammonium nitrate, according to its website.