Compass Minerals Completes Acquisition of Leading Brazilian Specialty Plant Nutrition Company
04 October 2016 - 7:10AM
Business Wire
Compass Minerals (NYSE: CMP) today announced it has completed
the purchase of all remaining interest in Produquímica Indústria e
Comércio S.A. (Produquímica), one of Brazil’s leading manufacturers
and distributors of specialty plant nutrients. As previously
disclosed, the acquisition is expected to add $0.12 to $0.15 to
earnings per share in 2016, excluding any purchase accounting
adjustments.
“With this acquisition complete, Compass Minerals has delivered
on a key component of our growth strategy. We have expanded the
geographic scope of our operations into one of the world’s most
important agriculture markets, broadened our portfolio of specialty
plant nutrition products, and reduced our dependency on winter
weather,” said Fran Malecha, Compass Minerals president and CEO. “I
am delighted to officially welcome all of the employees and
associates of Produquímica to Compass Minerals and look forward to
the growth we can achieve as one company.”
Compass Minerals purchased 35 percent of Produquímica in
December 2015. Total consideration for the remainder of
Produquímica was approximately $465 million (based on a Brazilian
Real-to-US$ exchange rate of R$3.25/US$1.00). This includes the
purchase of equity valued at $328 million based on Produquímica’s
estimated 2016 earnings, subject to customary, post-closing
adjustments, and the assumption of approximately $137 million of
net debt. The company expects to retire a portion of Produquímica’s
debt during the fourth quarter of 2016.
Based in São Paulo, Brazil, Produquímica generated approximately
R$1.2 billion in net revenue and R$198 million in EBITDA* as of the
12 months ending June 30, 2016. Produquímica operates two primary
businesses – agricultural productivity and chemical solutions. The
agricultural productivity division manufactures and distributes a
broad offering of specialty plant nutrition solution-based
products. These include micronutrients, controlled release
fertilizers, and other specialty supplements used in direct soil
and foliar applications, as well as through irrigation systems and
for seed treatment. Produquímica also manufactures and markets
specialty chemicals, primarily for the water treatment industry and
for use in other industrial processes in Brazil. Both businesses
are supported by robust research and development capabilities and a
strong technical sales force, which have helped fuel Produquímica’s
revenue and earnings growth. For the period from 2011 to 2015,
Produquímica’s net sales and EBITDA* grew at 16 percent and 19
percent compounded annual growth rates, respectively.
Additional details regarding the transaction can be found in a
Form 8-K the company filed today with the U.S. Securities and
Exchange Commission.
*Earnings before interest, taxes, depreciation and
amortization.
About Compass Minerals
Compass Minerals is a leading provider of essential minerals
that solve nature’s challenges, including salt for winter roadway
safety and other consumer, industrial and agricultural uses, and
specialty plant nutrition minerals that improve the quality and
yield of crops. Named one of Forbes’ 100 Most Trustworthy Companies
in America in 2016 and 2015, Compass Minerals’ mission is to be the
best essential minerals company by delivering where and when it
matters. The company produces its minerals at locations throughout
the U.S. and Canada and in the U.K. For more information about
Compass Minerals and its products, please visit
www.compassminerals.com.
This press release may contain forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including without limitation statements about the expected
additions to earnings per share and the timing and amount of debt
retirement. The company uses words such as “may,” “would,” “could,”
“should,” “will,” “likely,” “expect,” “anticipate,” “believe,”
“intend,” “plan,” “forecast,” “outlook,” “project,” “estimate” and
similar expressions suggesting future outcomes or events to
identify forward-looking statements or forward-looking information.
These statements are based on the company’s current expectations
and involve risks and uncertainties that could cause the company’s
actual results to differ materially. The differences could be
caused by a number of factors, including foreign exchange rates,
the risk that the acquisition of Produquímica could disrupt the
plans and operations of the company, Produquímica or both, and the
risk that the company may not realize the expected financial and
other benefits from the acquisition. For further information on
risks and uncertainties that may affect the company’s business, see
the “Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” sections of the
company’s Annual Report on Form 10-K for the year ended December
31, 2015, and its Quarterly Reports on Form 10-Q for the quarters
ended March 31, 2016 and June 30, 2016, filed with the SEC. The
company undertakes no obligation to update any forward-looking
statements made in this press release to reflect future events or
developments. Because it is not possible to predict or identify all
such factors, this list cannot be considered a complete set of all
potential risks or uncertainties.
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version on businesswire.com: http://www.businesswire.com/news/home/20161003006418/en/
Compass MineralsInvestor ContactTheresa L. Womble,
+1-913-344-9362Director of Investor
Relationswomblet@compassminerals.comorMedia ContactTara
Hart, +1-913-344-9319Manager of Corporate
AffairsMediaRelations@compassminerals.com
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