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Wednesday, October 7, 2020 - 1:35:54 PM
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Mining News Pro - German minerals company K+S Aktiengesellschaft has agreed to sell its Americas salt business to industrial holding company Stone Canyon Industries, Mark Demetree and affiliates for $3.2-billion.
formerly known as the Chilean company, acquired in 2006, as well as Morton Salt (USA) and K+S Windsor Salt (Canada), acquired in 2009.
The sale, K+S chairperson Burkhard Lohr said, formed part of a package of measures announced in December 2019 to reduce the group’s debt by more than €2-billion by the end of 2021. The transaction announced on Tuesday would help to reduce debt even more significantly.
“We are creating a solid financial basis for the sustainable development of the company.”
The sale of the Americas operating unit would be accompanied by the reorganisation of the remaining administrative functions in Germany, which would reduce administrative costs by 30% for a total of about €60-million a year.
K+S would also aim to reach positive free cash flow at all German production sites even with a low global price level for potash, as well as weak demand for de-icing salt as a result of weather conditions. For this purpose, the cost and capital expenditure structure of all production sites would be optimised.
K+S pointed out that it was strongly positioned in Europe and Canada with its needs-based fertilisers and specialties and that it had a robust business with industrial products.
The sales price of $3.2-billion represents 12.5 times the 2019 earnings before interest, taxes, depreciation and amortisation of $257-million. The closing of the transaction is expected to occur in summer 2021, subject to customary closing conditions, including approvals from regulatory authorities. The purchase price will be paid in cash at that time.
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https://www.miningnews.ir/En/News/605885
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