DSM to sell DSM Agro and DSM Melamine to Orascom Construction Industries
(Thomson Reuters ONE) -
Royal DSM N.V., the global Life Sciences and Materials Sciences company
headquartered in the Netherlands, and Orascom Construction Industries (OCI)
today announce that they have reached an agreement for the sale of DSM Agro and
DSM Melamine to OCI for EUR 310 million on a cash and debt-free basis with
effect from 1 January 2010. The intended sale is expected to close in Q2 2010,
subject to regulatory and other customary approvals and notifications.
For DSM the intended sale of both business groups is an important step forward
in the realization of its Vision 2010 ambitions to focus on Life Sciences and
Materials Sciences. The transformation of DSM's portfolio is an important
prerequisite for achieving these ambitions. As announced in September 2007, DSM
Agro and DSM Melamine do not fit with this focus.
With the acquisition of DSM Agro, the OCI Fertilizer Group expands its customer
base in key European markets to which the group will be able to offer a wider
range of products including urea, ammonia, Calcium ammonium nitrate (CAN), urea
ammonium nitrate (UAN), and ammonium sulphate (AS). OCI believes that healthy
synergies exist through a wider product portfolio and distribution
infrastructure in Europe.
OCI will assume responsibility for the business results of DSM Agro and DSM
Melamine from 1 January 2010 onwards. OCI fully supports DSM's strategy and
approach on the Chemelot site in Sittard-Geleen (Netherlands), where the main
facilities of both business groups are located. Via DSM Agro and DSM Melamine
OCI will become an indirect shareholder in Sitech Services B.V. and will
consequently make use of synergies in site and manufacturing services and
participate in infrastructural site investments.
Feike Sijbesma
CEO/Chairman of the DSM Managing Board, said: "The intended sale of DSM Agro and
DSM Melamine is a very important step in DSM's transformation towards a Life
Sciences and Materials Sciences company. Reshaping our portfolio is a main
building block of our Vision 2010 strategy."
Nico Gerardu
the DSM Managing Board and responsible for the Base Chemicals and Materials
cluster, gave the following comment: "In OCI DSM has found an excellent new
owner for DSM Agro and DSM Melamine. The strategic fit of both business groups
with OCI is strong, which will provide a sound basis for a prosperous future for
these businesses. DSM welcomes OCI on the Chemelot site and is pleased to be
able to continue its industrial park site concept. I would like to thank all DSM
Agro and DSM Melamine employees for their ongoing support and substantial
contribution to DSM."
Nassef Sawiris
Chairman and Chief Executive Officer of OCI, commented: "The acquisition of DSM
Agro and DSM Melamine fits perfectly in our strategy to become among the global
leaders in fertilizer production and distribution. It provides us with a strong
position in the fertilizer market in Northwest Europe, further product and
geographic diversification as well as a leading position in the melamine market
worldwide, which as a downstream activity to urea provides a new area of growth
for our company. I look forward to welcoming the employees of both business
groups to the OCI group. Together we will continue to deliver exceptional value
for our customers and shareholders."
DSM Agro and DSM Melamine together employ 779 people. DSM Agro is a producer of
ammonia and high-nitrogen fertilizers for grasslands and agricultural crops and
the market leader in the Netherlands. It also ranks among the market leaders in
Germany, France and Belgium. DSM Agro, which operates a production site in
Sittard-Geleen, produces about 1.6 million tons of fertilizers per year. DSM
Agro realized net sales of EUR 338 million in 2009.
DSM Melamine is the world's largest producer of melamine. The main application
of melamine is in wood-based panels and laminates used for furniture and
flooring. DSM Melamine has a plant in the Netherlands and also produces melamine
in joint ventures in China (DSM 49%) and Indonesia (DSM 60%). In 2009 DSM
Melamine realized net sales of EUR 151 million.
The OCI Fertilizer Group now ranks among the top 10 nitrogen-based fertilizer
producers worldwide in terms of production capacity. It has 2 million tons of
nitrogen fertilizer capacity in Egypt. In 2010/2011 the fertilizer complex in
Algeria in partnership with state-owned Sonatrach expects to commission its
state-of-the-art fertilizer complex which boasts an annual production capacity
of 2 million tons. With production from Algeria, the upgrade of the urea
production facilities in Egypt and new investments in derivatives such as
ammonium sulphate and UAN the OCI Fertilizer Group will achieve an annual
production capacity of approximately 5 million tons of nitrogen-based
fertilizers.
Since 2008, DSM Agro and DSM Melamine have been grouped in the Base Chemicals
and Materials cluster together with a number of other activities that do not fit
in with DSM's strategic focus. The selling process for most of the remaining
businesses in this cluster is underway.
For reporting purposes, DSM Agro and DSM Melamine will be reclassified from the
Base Chemicals and Materials cluster to assets held for sale at the end of Q1
2010. The businesses will be valued at fair value less costs to sell upon
reclassification which is expected to result in a small loss which will be
reported as an exceptional item in Q1 2010. DSM is providing the investment
community with comparative quarterly figures for 2009 in a separate press
release today.
The intended sale is dependent on regulatory and other customary approvals and
notifications and will be submitted to the works councils according to the usual
procedures in the Netherlands. One day before the closing, all employees in DSM
Agro and DSM Melamine will be transferred to DSM Agro B.V. and DSM Melamine
B.V., the companies to be acquired by OCI, in accordance with Dutch regulations.
Investors and analysts call
DSM will hold a conference call for investors and analysts from 09.30 AM -
10.00 AM CET. Dial-in numbers are +31 10 294 4271 (Continental Europe) and +44
203 365 3207 (United Kingdom). A replay will be available.
Orascom Construction Industries
Over the last 50 years, OCI has grown into one of Egypt's largest corporations
with projects and investments across Europe, the Middle East and North Africa.
The company directly employs more than 86,000 people. OCI is the largest company
listed on the Egyptian Stock Exchange with a secondary listing on the London
Stock Exchange with a market capitalization of approximately US$ 10 billion as
at 29 March 2010. OCI currently has two core business activities. The OCI
Construction Group is a leading construction contractor active in emerging
markets with a backlog of US$ 6.6 billion as at 31 December 2009. It primarily
focuses on infrastructure projects in Europe, the Middle East and Africa in
addition to industrial and high-end commercial projects. The OCI Fertilizer
Group is a strategic owner and operator of nitrogen fertilizer plants in Egypt
and Algeria with an international distribution platform spanning Latin America,
the United States, Europe and Africa. More information: www.orascomci.com
DSM - the Life Sciences and Materials Sciences Company
Royal DSM N.V. creates solutions that nourish, protect and improve performance.
Its end markets include human and animal nutrition and health, personal care,
pharmaceuticals, automotive, coatings and paint, electrical and electronics,
life protection and housing. DSM manages its business with a focus on the triple
bottom line of economic prosperity, environmental quality and social equity,
which it pursues simultaneously and in parallel. DSM has annual net sales of
about ? 8 billion and employs some 22,700 people worldwide. The company is
headquartered in the Netherlands, with locations on five continents. DSM is
listed on Euronext Amsterdam. More information: www.dsm.com
For more information:
DSM Corporate Communications DSM Investor Relations
Herman Betten Hans Vossen
tel. +31 (0) 45 5782017 tel. +31 (0) 45 5782864
fax +31 (0) 45 5740680 fax +31 (0) 45 5782595
e-mail media.relations(at)dsm.com e-mail
OCI Investor Relations Department OCI Investor Relations
Department
Omar Darwazah
Erika Wakid
Tel +202 2461 1036
Tel +202 2461 0727
Fax +202 2461 9409
Fax +202 2461 9409
omar.darwazah(at)orascomci.com
Forward-looking statements
This press release may contain forward-looking statements with respect to DSM's
future (financial) performance and position. Such statements are based on
current expectations, estimates and projections of DSM and information currently
available to the company. DSM cautions readers that such statements involve
certain risks and uncertainties that are difficult to predict and therefore it
should be understood that many factors can cause actual performance and position
to differ materially from these statements. DSM has no obligation to update the
statements contained in this press release, unless required by law. The English
language version of the press release is leading.
[HUG#1399046]
Press release-pdf: http://hugin.info/130663/R/1399046/354667.pdf
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