Yara and Praxair to establish JV in industrial gases
Yara International ASA and Praxair, Inc. have signed a Heads of Agreement with the intention of establishing a joint venture to further enhance development opportunities for Yara's industrial gases business. The planned joint venture would be owned 50% by each partner and comprise Yara's existing industrial gases business located in Norway, Denmark and Sweden.
The intention is to establish the new company during third quarter 2007, with completion of the transaction subject to certain conditions and obtaining regulatory approvals. The venture would operate under the name "Yara Praxair AS" and would be based in Oslo, Norway. It would be headed by Per Kværum and the Board of Directors would consist of representatives from both companies and the employees. The agreement would result in a one-time net income for Yara of more than NOK 700 million, which is expected to be booked in the third quarter.
Yara and Praxair will review the strategy to expand the industrial gases business further into new product segments and geographical areas. In 2006, Yara's existing industrial gases business had sales of NOK 940 million.
Yara's CO2 business in Europe will continue as a wholly owned business unit in Yara. Yara will continue to further develop its European CO2-activity, and will supply the new joint venture with CO2 and argon in Scandinavia.
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