HEERLEN,NETHERLANDS - Royal DSM N.V. and Orascom Construction Industries (OCI) announced that they have reached an agreement for the sale of DSM Melamine and DSM Agro to OCI for approximately $420 million on a cash and debt-free basis with effect from Jan. 1, 2010.
The intended sale is expected to close in Q2 2010, subject to regulatory and other customary approvals and notifications.
For DSM the intended sale of both business groups is an important step forward in the realization of its Vision 2010 ambitions to focus on Life Sciences and Materials Sciences. As announced in September 2007, DSM Agro and DSM Melamine do not fit with this focus.
With the acquisition of DSM Agro, the OCI Fertilizer Group expands its customer base in key European markets to which the group will be able to offer a wider range of products including urea, ammonia, Calcium ammonium nitrate (CAN), urea ammonium nitrate (UAN), and ammonium sulphate (AS).
Nassef Sawiris, chairman and CEO of OCI, said, “The acquisition of DSM Agro and DSM Melamine fits perfectly in our strategy to become among the global leaders in fertilizer production and distribution. It provides us with a strong position in the fertilizer market in Northwest Europe, further product and geographic diversification as well as a leading position in the melamine market worldwide, which as a downstream activity to urea provides a new area of growth for our company.”
DSM Melamine claims to be the world’s largest producer of melamine. The main application of melamine is in wood-based panels and laminates used for furniture and flooring. DSM Melamine has a plant in the Netherlands and also produces melamine in joint ventures in China (DSM 49%) and Indonesia (DSM 60%). In 2009 DSM Melamine realized net sales of approximately $204 million.
Have something to say? Share your thoughts with us in the comments below.