By John Kell
Mosaic Co. agreed to pay $350 million to acquire Archer Daniels
Midland Co.'s fertilizer distribution business in Brazil and
Paraguay, a move aimed at better tapping a promising agricultural
market.
The fertilizer company had previously signaled it intended to
invest in additional distribution assets in Brazil, a market Mosaic
claims is the largest potash importer in the world, with growth
expected to continue owing to rising demand and lower domestic
production.
In particular, Mosaic had said it was looking to invest in
additional distribution assets in Brazil.
The deal Mosaic signed with Archer Daniels includes four
blending and warehousing facilities in Brazil and one in Paraguay.
The all-cash deal assumes the delivery of $150 million in working
capital at closing.
The companies have also negotiated the terms of five-year
fertilizer supply agreements, in which Mosaic will supply Archer
Daniels's fertilizer needs in those two countries.
Mosaic President and Chief Executive James Prokopanko said the
acquisition announced Tuesday complements other recent moves,
including the company's $1.4 billion purchase of fellow fertilizer
company CF Industries Holdings Inc.'s phosphate operations.
Write to John Kell at john.kell@wsj.com
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