Sector News

Itafos and GB Minerals to merge

January 2, 2018
Energy & Chemical Value Chain

Phosphate producers Itafos (Houston, Texas) and GB Minerals (Vancouver, Canada) announced on Thursday that they plan to merge. Financial terms were not disclosed.

The deal provides a “clear path” for GB Minerals to finance and develop its plans for expanding its Farim phosphate project in Guinea-Bissau, West Africa. Brian Zatarain, CEO of Itafos, says Farim is “one of the highest-quality phosphate projects in the world.” The initial capital cost for the project is estimated at $193.8 million.

The combined company will also benefit from enhanced technical expertise, project management capabilities, and financial resources. GB Minerals will receive an interim financing of $7 million from Itafos.

Itafos is already the second largest investor in GB Minerals with a 31.3% stake. Directors and senior officers of GB Minerals, who in aggregate hold 1.09% of the outstanding GB Minerals Shares and 70.25% of the GB Minerals Options, as well as A.B. Aterra Resources Ltd.—a GB Minerals Shareholder that controls 46.5% of the GB Minerals Shares—have agreed to vote their GB Mineral Shares and GB Minerals Options in favor of the Arrangement.

The deal is expected to close in late February 2018, subject to regulatory and shareholder approvals. Shareholders of GB Minerals will receive either 0.035714 of an Itafos share for each GB Minerals share held, or a combination of C$0.05 in cash and 0.011905 of an Itafos share for each GB Minerals share held.

Itafos owns the Itafos Arraias 500,000 tons/year Single Super Phosphate (SSP) operations, which comprise a phosphate mine, a mill, a beneficiation plant, a sulfuric acid plant, an SSP plant, and related infrastructure located in central Brazil. The company also has phosphate projects in Brazil, the United States, and Peru. It recently agreed to acquire Agrium’s (Calgary, Alberta) Conda, Idaho, phosphate operations to Itafos for about $100 million. The Conda facility produces approximately 540,000 metric tons/year of mono-ammonium phosphate (MAP), super phosphoric acid (SPA), merchant-grade phosphoric acid, and specialty products.

By Rebecca Coons

Source: Chemical Week

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