Intrepid Potash Inc. filed an initial public offering with the U.S. Securities Exchange Commission Dec. 20 to raise up to $100 million. Intrepid Potash, a Delaware corporation, would use the proceeds to acquire all the assets of Intrepid Mining other than cash and to pay debt.
Intrepid Mining, the largest producer of muriate of potash in the U.S., has five active potash production facilities – three in New Mexico and two in Utah – and has nameplate capacity to produce 1,100,000 tons of potash and 250,000 tons of langbeinite annually.
Intrepid owns two development assets in New Mexico – the HB Mine, which is an idled potash mine that it plans to reopen as a solution mine, and the idled North Mine. Intrepid believes that expansion opportunities at operating facilities and the HB Mine will increase production by an aggregate of over 370,000 tons of potash and langbeinite annually over the next five to seven years. Intrepid also produces salt, magnesium chloride, and metal recovery salts from its potash mining processes.
Intrepid expects to begin Phase 1 expansion at the HB mine in 2008, with production beginning in 2009. It believes Phase I has the potential to ultimately add up to 150-200,000 tons of additional low-cost potash production by 2011. Intrepid will also consider reopening the North Mine, another idled underground potash mine, which already has in place mine shafts and much of the transportation and utility infrastructure required for operation.
Income from continuing operations was $23.1 million on sales of $140.1 million for the nine months ending Sept. 30, 2007, according to Intrepid’s prospectus. This compares to a year-ago $13.4 million and $100.7 million, respectively.
The Denver-based Intrepid Mining was founded in 2000 to acquire the Moab Mine in Utah from Potash Corp. of Saskatchewan Inc. Thereafter it also bought Mississippi Potash Inc. and Eddy Potash Inc. in New Mexico from Mississippi Chemical Co., and the assets of Reilly Chemical Inc. in Wendover, Utah.
Morgan Stanley is underwriting the IPO.