Dec. 6 (Bloomberg) -- Yara International ASA, the world’s largest publicly traded nitrogen-fertilizer maker, is looking toward Latin America and Africa for immediate growth opportunities amid high asset prices in North America and Europe, Chief Executive Officer Joergen Ole Haslestad said.
The company, based in the Norwegian capital, is talking to companies in sub-saharan Africa, where it has a competitive advantage over peers, to form joint ventures or make acquisitions, the executive said. With joint ventures, Yara would target ownership of at least 50 percent to have control, he said.
Yara is already active in Africa, delivering several hundred thousands of tons of fertilizer into the region, where U.S. competitors have so far made few inroads, he said. Africa is probably the only area where you can find "cheap gas pockets,’’ needed to make nitrogen fertilizer, Haslestad said in an interview in Oslo today, after hosting a capital markets day.
“You have countries like Tanzania, Angola, Ghana and they all have been out saying we do have gas and we would like to exploit it,” said the CEO. “That would not mean that it would give us at a better price, but at least we will be the once they will come to,” according to the CEO.
The company is also looking at Latin America, a high-growth region where Yara can leverage its broad presence, and where market opportunities for value-added fertilizer are “significant,” the company said today. Brazil is the “most relevant” market, according to the CEO.
In Australia, Yara’s pre-emptive rights to gain control of the Burrup ammonia plant represent a further growth opportunity, the company said. Yara owns 35 percent of Burrup Fertilisers’ parent, Burrup Holdings Ltd. and has the right to match any offers. Yara is however not in control of the current sales process and has seen “very little movement” over the last month, the CEO said.
The Australian ammonia producer is under receivership.
“We hope that we will see some changes in the next weeks and couple of months to come,” the CEO said.
For Related News & Information: News on Yara: YAR NO <Equity> CN <GO>
--Editors: Andrew Noel, Tom Lavell
To contact the reporter on this story: Meera Bhatia in Oslo at firstname.lastname@example.org.
To contact the editor responsible for this story: Christian Wienberg at email@example.com