Russian fertilizer and chemical companies Uralkali and Uralchem have agreed with Fertilizantes Heringer SA to become controlling shareholders in the Brazilian firm that is now under bankruptcy protection.
In a securities filing, Fertilizantes Heringer said the Russian companies would buy the Brazilian firm’s shares for 2 reais ($0.4796) each in a deal that would result in a capital increase of up to $110 million.
The Russian companies are already doing business in Brazil, one of the largest markets for fertilizers in the world, selling potash and nitrogen for companies who prepare and distribute formulations for farmers.
With Heringer, they will expand their presence in the country that is a leading global food producer.
Heringer used to be one of the 10 largest fertilizer companies in Brazil before launching a plan to restructure operations earlier this year, and then, filing for bankruptcy protection shortly after.
The company closed some installations, including plants and regional offices.
Uralkali is among the 10 largest players in the global fertilizer market. It is a large producer and exporter of potash, one of the three key components of the most popular formulations of fertilizers that also contain nitrogen and phosphorus.
Uralchem produces nitrogen and the company is a shareholder in Uralkali.
Source: Reuters.com