TEL AVIV, Israel, January 15, 2016 /PRNewswire/ --
$250 million investment deepens ICL's strategic alliance with the parent company of its phosphates joint venture partner in China
ICL (NYSE and TASE: ICL), a global manufacturer of products based on specialty minerals that fulfill essential needs of the world's growing population in the agriculture, food and engineered materials markets, announced that it completed a 15% equity investment in Yunnan Yuntianhua Co., Ltd. ("YTH"), the parent company of ICL's phosphates joint venture partner in China, Yunnan Phosphate Chemicals Group Corporation Ltd. ("YPC"). YPC is China's leading phosphate producer.
YTH, a Shanghai Stock Exchange listed company (CH:600096), issued ICL 199,249,088 new shares of YTH through a private placement for 8.24 RMB/share. The investment was approved by China's Ministry of Commerce and its Securities Regulatory Commission.
As strategic investors in YTH, ICL will nominate 2 out of 11 YTH board members, one of whom will be Stefan Borgas, ICL's President & CEO. ICL's representation on YTH's board, as well as on a phosphate business committee to be established to provide advice and make recommendations related to YTH's phosphate business, and ICL's right to appoint a deputy general manager for each of YTH and two of its subsidiaries, is expected to permit ICL to have oversight over these businesses and to contribute to their growth and profitability.
ICL's investment in YTH is part of the formation of a phosphate joint venture by ICL and YTH (the "YPH JV") and will deepen their strategic alliance. ICL takes the lead in managing the operation of YPH JV's business which has become a fully operating business unit of ICL, and whose results will be consolidated into ICL's financial reports. The JV is expected to provide ICL with a platform to penetrate growing Asian specialty phosphate markets.
Over the next five years ICL and YTH plan to build specialty plants and triple the JV's white phosphoric acid (WPA) capacity. The partners have also established a phosphate R&D platform in Kunming (Yunnan province) which is focused on developing next-generation phosphate-based products and process technologies for the YPH JV and their respective businesses.
Commenting on the financial transaction, ICL's CEO, Stefan Borgas, stated, "We are pleased to finalize our strategic investment in YTH which is a key element of our strategic alliance with Yunnan Yuntianhua. This investment deepens our strong working relationship with YTH, and we believe that our representation on several YTH governing bodies will help facilitate our efficient management of the YPH JV."
ICL is a global manufacturer of products based on specialty minerals that fulfill humanity's essential needs primarily in three markets: agriculture, food and engineered materials.
ICL produces approximately a third of the world's bromine, and is the sixth largest potash producer, as well as the leading provider of pure phosphoric acid. It is a major manufacturer of specialty fertilizers, specialty phosphates and flame retardants. ICL's mining and manufacturing activities are located in Israel, Europe, the Americas and China, and are supported by global distribution and supply networks.
The agricultural products that ICL produces help to feed the world's growing population. The potash and phosphates that it mines and manufactures are used as ingredients in fertilizers and serve as an essential component in the pharmaceutical and food additives industries. The food additives that ICL produces enable people to have greater access to more varied and higher quality food. ICL's water treatment products supply clean water to millions of people as well industry around the world. Other substances, based on bromine and phosphates help to create energy that is more efficient and environmentally friendly, prevent the spread of forest fires and allow the safe and widespread use of a variety of products and materials.
ICL benefits from a number of unique advantages, including its vertically integrated activities and complementary and synergistic downstream operations for the production of unique end products; its balanced and varied product portfolio in growing markets; broad presence throughout the world and proximity to large markets, including in emerging regions.
ICL operates within a strategic framework of sustainability that includes a commitment to the environment, support of communities in which ICL's manufacturing operations are located and where its employees live, and a commitment to all its employees, customers, suppliers and other stakeholders.
ICL is a public company whose shares are dual listed on the New York Stock Exchange and the Tel Aviv Stock Exchange (NYSE and TASE: ICL). 46% of ICL's equity is held by Israel Corp., 13.8% by Potash Corporation of Saskatchewan and the remainder by the public.
The company employs approximately 14,000 people worldwide, and its sales in 2014 totaled US $6.1 billion. For more information, visit the company's website at http://www.icl-group.com.
Forward Looking Statement
This press release contains statements that constitute "forward-looking statements", many of which can be identified by the use of forward-looking words such as "anticipate", "believe", "could", "expect", "should", "plan", "intend", "estimate" and "potential" among others. Forward-looking statements are based on our management's current beliefs and assumptions and on information currently available to our management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to, changes in the demand and price environment of the products as well as shipping and energy costs, whether caused by actions of governments, manufacturers or consumers, changes in the capital markets, including fluctuations in currency exchange rates, credit availability, interest rates, changes in the competition structure in the market, shortage with respect to our principal raw materials, the difference between actual reserves and the reserve estimates, accidents or disruptions in the manufacturing facilities, failure to provide the necessary infrastructure and services, and those in "Item 3. Key Information-D. Risk Factors" in the Company's annual report on Form 20-F filed with the U.S. Securities and Exchange Commission on March 20, 2015. Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update or revise them or any other information contained in this press release, whether as a result of new information, future developments or otherwise.