26 September 2013 10:52 [Source: ICIS news]
LONDON (ICIS)--Grupa Azoty is to vertically integrate sulphur production by buying the Polish treasury ministry’s 85% stake in Polish sulphur mining company Zaklady Chemiczne Siarkopol, Poland’s largest chemical group said on Thursday.
The deal, at an undisclosed price and contingent on the approval of competition regulators, would mean that state-controlled Grupa Azoty, Europe’s second largest fertilizer producer, was not at risk of losing the approximately 300,000 tonnes of liquid sulphur that it purchases from Siarkopol – Poland’s only sulphur producer – each year, it added.
“The main reason for this deal is to increase the safety of sulphur supplies, in our view,” said Piotr Drozd, a chemical industry analyst at Prague-based investment bank WOOD & Company, adding that he expected the deal to be closed by the end of November.
Siarkopol was expected by the bank to generate 2013 earnings before interest, tax, depreciation and amortisation (EBITDA) of zloty (Zl) 30m-40m ($9.6m-12.8m, €7.1m-9.5m).
The company, based in Grzybow, southeastern Poland, owns the Osiek sulphur mine – the only mine in the world where sulphur is extracted using the underground melting method.
($1 = €0.74, $1 = Zl 3.12, €1 = Zl 4.22)
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