Agrium To Acquire European Distribution Network
Agrium Inc. announced that it has entered into an exclusive agreement to acquire a 70 percent equity position in Common Market fertilizers S.A. ("CMF"), one of Western Europe's largest fertilizer distribution companies. CMF has annual sales revenues of $500 to $600 million, crop nutrient sales volumes of 2 to 2.5 million tonnes and an annual EBITDA of approximately $10-million.
The purchase price for 70 percent of the business is $16-million plus working capital of approximately $50-million. The transaction is expected to close in the second quarter of 2008, subject to concluding a definitive purchase and sale agreement, due diligence and regulatory approval. Oscar Geyer will remain as CEO of CMF, and will continue to hold an equity position in the company.
"This acquisition is a key step in our global wholesale distribution strategy. Europe will be a key end-market for product from our Egyptian nitrogen facility, which is currently under construction. CMF provides us with important access to major distribution assets across Europe, expansion of our sourcing footprint into Eastern Europe, as well as one of Europe's most experienced teams in fertilizer logistics, distribution, purchasing and sales. Agrium will become one of the largest global distributors by combining volumes from our Egyptian production, our North American purchase for resale business and volumes from CMF, said Mike Wilson, Agrium's President and CEO.
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