India’s Coromandel International Ltd. has reached a deal to acquire a 45% stake in the Senegal-based phosphate mining company Baobab Mining and Chemicals Corp. (BMCC) for $19.6 million, plus a loan to BMCC of a further $9.7 million.
Coromandel is making the acquisition through a wholly-owned subsidiary, Parry Chemicals Ltd., according to a May 6 statement by the Indian company. The transaction is expected to be completed in the second quarter of Indian fiscal year 2022-23, and remains subject to the satisfactory completion of conditions precedent in the parties’ acquisition agreement.
As part of its strategy to strengthen its value chain, Coromandel said it has been evaluating opportunities in the phosphate mining sector to secure its phosphate rock needs.
“Towards this, Coromandel’s Board has approved the buyout of equity of 45% in BMCC. The investment will help in strengthening our backward integration and will ensure long-term supply security of the key raw material,” the Indian company said.
BMCC is in the business of the mining, production, and sale of rock phosphate. It stabilized its operations and commenced active production from 2021, and at full capacity BMCC can meet up to one-third of Coromandel’s phosphate rock requirement, Coromandel said.
The Indian company’s fertilizer assets include three plants capable of producing 3 million mt/y of phosphate fertilizers. It is a partner in Tunisian phosphoric acid producer Tunisian Indian Fertilizer SA (TIFERT) and holds an interest in South Africa’s Foskor Pty Ltd., via which it secures its phosphoric acid requirements.