Yara seeks to acquire Kemira GrowHow

Oslo-Yara International ASA said May 24 that it has acquired 30.05 percent of all shares and votes in Kemira GrowHow Oyj from the State of Finland. The purchase price paid for the shares is EUR 12.12 per share (US$16.29). Since Yara will own three-tenths of Kemira, it must launch a mandatory tender offer for the remaining shares in the company at the same price of EUR 12.12 per share in accordance with the Finnish Securities Markets Act. “I am very excited about the opportunities this transaction will create and pleased that two Nordic companies with a strong history can combine their strengths in meeting the global competition. Kemira GrowHow’s phosphate mining, processing and commercialization complements Yara’s existing business extremely well,” said Thorleif Enger, Yara president and CEO. Kemira GrowHow owns a major phosphate mine at Siilinjärvi, Finland, and has access to additional phosphate rock through mining rights at Sokhli. Yara says Kemira’s phosphate rock mining, phosphoric acid, and finished products at Siilinjärvi and Uusikaupunki in Finland will be important additions to Yara’s phosphate-related capabilities, and represent new capacity within Yara. Yara is interested in opening the Sokli mine in Finnish Lapland to explore the commercial utilization of the phosphate raw material extracted from the mine, if a commercially sustainable means of implementation can be found. Yara sees very little overlap between the two companies. Kemira is one of the leading producers of fertilizers and feed phosphates in Europe, with production facilities in 8 countries, sales to over 100 countries, and approximately 2,500 employees. Kemira focuses on providing customized fertilizers and related services for crop cultivation, feed phosphates for use in animal feed, and process chemicals for selected industrial segments. During the first quarter of 2007 net sales were EUR 350 (US$470.4 million) and operating profit EUR 21.4 million (US$28.8 million). The tender offer will value Kemira at EUR 671.8 million, or US$903 million, on an equity value basis.