Australia’s Incitec Pivot flags year-long delay to explosives enterprise cut up

© Reuters. FILE PHOTO: A truck driver waits to load his vehicle outside the Incitec Pivot fertilizer and explosive chemical plant in Geelong,February 26, 2014. REUTERS/Jason Reed/File Photo

(Reuters) -The demerger of the explosives manufacturing business of Australia’s top fertiliser maker Incitec Pivot Ltd could be delayed by up to an year, the firm said on Tuesday, as it considers buyout offers for its ammonia manufacturing facility in Louisiana, United States.

Incitec in May had said it would separately list the explosives maker Dyno Nobel, which it acquired in 2008 for nearly A$3 billion ($2.01 billion), with the aim of speeding up growth in the explosives and fertiliser businesses.

However, the ammonia manufacturing facility in Waggaman, Louisiana (WALA), which is a part of Dyno Nobel Americas, received “a number of unsolicited approaches”, Incitec said, adding that there was no certainty regarding the offers.

The firm’s chairman, Brian Kruger, said strong ammonia market dynamics and improved asset performance make WALA “a very valuable asset and an attractive investment opportunity for high-quality counterparties”.

“For this reason, we have decided to re-sequence our strategic priorities to assess the opportunity with WALA in the short-term, while we continue to progress our demerger plans.”

The Southbank-based fertiliser maker said the previously announced target of completing the separation in early 2023 will likely be extended by six to 12 months, pending strategic review for WALA.

($1 = 1.4928 Australian dollars)

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