PotashCorp to boost investment in Sinofert to 20 percent
Provides formal notice of its intention to exercise its option to purchase an additional 10.01 percent of the shares in Sinochem Hong Kong Holdings Limited, more commonly known as Sinofert.
06/02/06 Potash Corporation of Saskatchewan Inc. has announced that it has provided formal notice of its intention to exercise its option to purchase an additional 10.01 percent of the shares in Sinochem Hong Kong Holdings Limited, more commonly known as Sinofert. The option exercise will raise PotashCorp's ownership interest in the company to 20 percent, assuming no further changes to Sinofert's shareholdings.
Under a Strategic Investment Agreement signed on June 7, 2005 with a subsidiary of Sinochem Corporation, PotashCorp purchased an initial 9.99 percent interest in Sinofert. Sinochem Corporation is a company with sales of US $20.4 billion in 2004 and a member of the Fortune Global 500 for the past 15 years. PotashCorp paid US $97 million for its initial interest and held the right to increase its ownership position no earlier than January 27, 2006. The total cost of the option exercise is expected to approximate US $125 million, with closing expected before the end of February 2006. PotashCorp will have the right to nominate a second member to the Sinofert Board of Directors at that time.
Sinofert is a leading fertilizer enterprise in the People's Republic of China (PRC). On December 19, 2005 it released its 9-month earnings of US $76 million, 51 percent higher than the comparable period in 2004. One of the largest importers of fertilizer products in the PRC in terms of import volume, it is the largest distributor of these products and is also a major producer of phosphate-based fertilizer products. At the end of November 2005, it had 14 branch offices and 1,036 sales centers as part of an extensive distribution network that provided products to 76 percent of total sown lands in China.
Potash Corporation of Saskatchewan Inc. is the world's largest fertilizer enterprise producing the three primary plant nutrients and a leading supplier to three distinct market categories: agriculture, with the largest capacity in the world in potash, third largest in phosphate and fourth largest in nitrogen; animal nutrition, with the world's largest capacity in phosphate feed ingredients; and industrial chemicals, as the largest global producer of industrial nitrogen products and one of only three North American suppliers of industrial phosphates.
http://www.newswire.ca/en/releases/archive/January2006/31/c2229.html
