Vienna-based Borealis AG said its fertilizer sales reached 3.21 million mt last year, an 18% decrease from the 3.91 million mt sold in 2021. The company on March 24 said the decline was the result of lower demand due to high gas prices and competitively priced urea imports into Europe.
Borealis now expects the sales of its Nitrogen business to the Czech Republic’s chemicals and fertilizer company Agrofert to close by the end of the first quarter. It initially had expected the deal to close by the end of 2022. Agrofert’s offer valued the business on an enterprise value basis at €810 million (approximately $878 million at current exchange rates).
Borealis received a binding offer for the business, which includes fertilizer, melamine, and technical nitrogen products, from the Czech company last June (GM June 3, 2022). On March 13, the European Commission “unconditionally” approved the deal (GM March 17, p. 30).
“The war in Ukraine and the sanctions imposed as a consequence have led to some delays,” said Borealis CFO Mark Tonkens on the company’s protracted divestment of the nitrogen business. “On careful deliberation, we declined the initial binding offer received from EuroChem in March and restarted the process. Agrofert emerged in June as the best bidder in the next divestment round.”
Tonkens said Borealis’ Executive Board is confident that Agrofert, a leading European fertilizer player, is committed to maintaining supply security and the long-term development of the production facilities.
The conclusion of the transaction with Agrofert, along with the sale in January of its shares in Belgian fertilizer company Rosier S.A. to Turkey’s Yildrim Group (GM Jan. 6, p. 29), will enable Borealis to sharpen its focus on providing “innovative and value-added solutions” in the fields of advanced circular polyolefins and base chemicals, the company said.