Genesis Energy said on Monday it had sold its soda ash manufacturing and related operations to an indirect unit of WE Soda for $1.43 billion, helping the pipeline operator to focus on the midstream energy sector.
Shares of Genesis were up 1.3% at $13.00 in premarket trading after the company also said $1.01 billion in proceeds would be used to reduce debt and buy back shares.
“This transaction gives Genesis the financial flexibility to accelerate the process of simplifying our capital structure,” CEO Grant Sims said in a statement.
The soda ash operations, or the alkali business, makes products including sodium bicarbonate and other specialty chemicals used in industries for glass manufacturing, detergents and battery production.
The business, located near Green River, Wyoming, has an annual production capacity of 4.3 million metric tons.
In 2017, Genesis had acquired the alkali business from Tronox for about $1.33 billion in cash to expand into the chemicals sector.
Source: Reuters.com