YARIY Yara International ASA (PK)

By Kjetil Malkenes Hovland 

OSLO--Industrial gases giant Praxair Inc. has agreed to buy carbon-dioxide and dry-ice assets from Norwegian fertilizer supplier Yara International SA for EUR312 million ($353 million) to bulk up its activities serving the food and beverage sector in Europe.

The companies said on Tuesday that Praxair would pay EUR218 million for Yara's carbon-dioxide business and EUR94 million for the Norwegian company's 34% stake in Yara Praxair Holding AS, a joint venture established in 2007 that delivers industrial gases and dry ice to the Scandinavian market,

The acquisition is part of Praxair's effort to expand in regions where it can gain cost savings as well as "enhancing our presence in noncyclical segments such as food and beverage," said Praxair Chairman and Chief Executive Steve Angel. Praxair's main customers include steelmakers, petrochemicals suppliers and the electronics industry.

Yara said it was exiting a noncore business.

"The CO2 business has been an attractive and long-standing part of Yara's portfolio, but remains a relatively small part of the broader industrial-gas industry, and where Praxair is well positioned to create additional value," said Yara Chief Executive Svein Tore Holsether.

Yara's European carbon-dioxide unit operates three CO2 ships, seven terminals, six dry ice production facilities and five CO2 liquefaction plans. Yara will continue to operate three of the liquefaction plants, which are integrated with Yara fertilizer plants, and will also supply raw CO2 and gas to Praxair.

Yara's European CO2 unit last year sold more than 850,000 tons of liquid carbon dioxide, which is used in beverages, food, refrigeration and industrial processes, and 50,000 tons of dry ice, generating revenue of EUR112 million. Yara Praxair Holding had revenue of EUR145 million last year.

The transaction is expected to close in the first quarter of 2016.

Write to Kjetil Malkenes Hovland at kjetilmalkenes.hovland@wsj.com

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(END) Dow Jones Newswires

September 15, 2015 03:41 ET (07:41 GMT)

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