All Posts from July 26, 2012

No buyer found for CVR

CVR Energy Inc., Sugar Land, Texas, said July 26, that the previously disclosed 60-day sale process to solicit acquisition proposals from third parties to acquire the stock and assets of CVR as an entirety ended July 23, 2012, without the receipt of a bona fide offer.

Jefferies & Company Inc., CVR’s financial adviser, contacted over 30 potential bidders, including independent refining companies and private equity firms, of which four signed confidentiality agreements. CVR received one indication of interest, which CVR and Jefferies did not believe to be credible. CVR did not incur any fees or expenses during the 60-day period in connection with the sales process.

As announced at the time of its tender offer for CVR shares Icahn Enterprises LP, the owner of approximately 82 percent of CVR, does not currently intend to seek to sell CVR.
Icahn Enterprises intends to focus on operating CVR’s business for the benefit of its stockholders because it believes that continual shopping of CVR could be disruptive to its operations.

Mr. Icahn stated at the time he completed his tender offer for CVR shares, that in order to reach a peaceful conclusion he agreed with the company to engage an investment banker to seek to sell the company at a price higher than the tender price, although at the time he stated that he did not believe such an offer would be forthcoming. Icahn also stated that he is quite happy with the current performance of the company and believes fully in its future success.

Export potash, impairment impact PotashCorp 2Q

Potash Corp. of Saskatchewan Inc. reported second quarter earnings of $0.60 per share ($522 million), which compared to $0.96 per share ($840 million) in the same period last year. The company said while this year’s second-quarter results reflected strong underlying performance, they were impacted by notable items, including a $341 million ($0.39 per share) impairment recorded on our investment in Sinofert Holdings Ltd. (Sinofert) and $29 million ($0.02 per share) in items related to the phosphate segment (included in cost of goods sold).

Accelerating potash demand, including unprecedented offshore sales volumes, and record contribution from nitrogen operations resulted in gross margin of $1.2 billion for the quarter, the third-best quarterly total in company history and slightly exceeding that of the same period last year.

For more details, see the Green Markets Web Edition July 27.

Simplot to expand plant

The J. R. Simplot Co. will expand its Rock Springs, Wyo., fertilizer manufacturing facility with work commencing on the project immediately.

To meet the increasing demand for critical plant nutrients, Simplot’s first phase of expansion projects will increase dry phosphate production by more than 30 percent. These expansion efforts will also provide the foundation for future capacity growth in both liquid and dry fertilizers.

“The initial stage is expected to be operational by early 2014,” said Martin Hunt, vice president of mining & manufacturing for Simplot. “This expansion aligns well with our strategic growth objectives, while helping diversify our product offering. A portion of the increased production resulting from these expansion efforts will go to Simplot’s new 40 ROCKTM branded product (12-40-0-6.5-1Zn).”

The company’s Vernal, Utah, mine supplies phosphate ore to the Rock Springs manufacturing facility and is expected to meet the incremental ore volumes for expansion efforts without further investment.

Growing and adapting to meet the needs of a rapidly changing customer is critical to future business success, according to Garrett Lofto, president of the Simplot AgriBusiness Group. “The need for expansion in agriculture continues to accelerate as the global demand for food, feed, fiber, and fuel increases. This expansion is an exciting opportunity for us and we are confident employees at both Rock Springs and Vernal will continue to take our integrated phosphate operation to new levels of success.”

Simplot president and CEO Bill Whitacre said, “For more than 75 years, the J. R. Simplot Company has played a key role in various sectors of the global food and agriculture system, and our commitment to this responsibility remains unchanged today.”

Simplot is a privately held agribusiness firm headquartered in Boise, Idaho. It has an integrated portfolio that includes phosphate mining, fertilizer manufacturing, farming, ranching and cattle production, food processing, food brands, and other enterprises related to agriculture. Simplot’s major operations are located in the North America, Australia, New Zealand and China, with products marketed in more than 40 countries worldwide. The company’s mission statement is Bringing Earth’s Resources to Life.