Norway’s Yara eyes potential IPO of its industrial nitrogen business

LONDON (ICIS)–Yara is evaluating an initial public offering (IPO) of its industrial nitrogen businesses in a move that would “create the first integrated industrial nitrogen” company, the Norwegian fertilizers major said on Wednesday.

Ahead of its capital markets day (CMD) in London, the Oslo-headquartered crop nutrient manufacturer revealed the conclusion of a final IPO scope is expected in early 2020.

“Such a company would take an industry-leading position, with the highest value proposition in core markets, a solid European platform and an attractive market portfolio balancing stability and growth,” Yara said.

“As part of the evaluation process, the business units mining applications (TAN), transport reagents and industrial nitrates will, effective 1 July 2019, be organised in a separate entity.”

Yves Bonte, previously executive vice president of new business, will take up the role as CEO of the entity, and no longer be a member of the Yara corporate management team.

“Yara is well underway to becoming a focused crop nutrition company, and the evaluation of an IPO is an important step in that direction,” added the firm’s CEO Svein Tore Holsether.

“A new ownership structure would allow these businesses to continue to thrive and grow profitably, while continuing to provide healthy returns to Yara.”

Yara also said it had achieved a 70% increase in targeted earnings improvements as a result of the Yara Improvement Program, adding it was expanding the program from 2020 to 2023.

“Key levers to achieve these targets will be higher production volumes and energy efficiency, a leaner cost base with clear fixed cost targets and improved working capital management,” Yara said.

“The improvement program is on track to meet its original end 2020 target, representing an important milestone towards realising the expanded targets by end 2023.”