Yara’s $165 Million Acquisition of Galvani in Brazil

Trench Rossi Watanabe (Baker McKenzie), Cescon, Barrieu, Flesch & Barreto and Candido Martins advised on the deal

Yara has reached an agreement to acquire the minority interest in Galvani Indústria, Comércio e Serviços S.A. from the Galvani family. As part of the deal certain assets will be transferred to the Galvani family, who will also receive a payment in cash and a contingent amount. Yara will thereby own 100% of the shares in Galvani Indústria, Comércio e Serviços S.A.

Yara Brazil will own 100% of the industrial unit in Paulínia with integrated Single Super Phosphate production and a fertilizer bulk blend facility, and the Serra do Salitre project with an annual production capacity of approximately 1.2 million tonnes of phosphate ore and 1.5 million tonnes of finished fertilizer (SSP equivalents).

The agreement includes a cash payment of USD 70 million over a 3-year period from closing, and a conditional future payment related to project success. The production unit in Luis Eduardo Magalhães and the mining units in Angico dos Dias and Irecê (all three in the state of Bahia), as well as the Santa Quitéria greenfield phosphate project will be separated out from Galvani Indústria, Comércio e Serviços S.A and will be fully controlled by a new company managed by the Galvani family. The carved-out assets transferred to the Galvani family have a book value equivalent to USD 95 million as of 31 August 2018.

This transaction is subject to conditions precedent that still need to be met, as well as the approval of the Brazilian antitrust authorities (CADE) and other common approvals.

Yara International ASA produces, distributes, and sells nitrogen-based mineral fertilizers and related industrial products. The company, led by Svein Tore Holsether, Petter Ostbo and Pierre Herben, in 2017 recorded $10.7 Billion Revenues.

Trench Rossi Watanabe (Baker McKenzie) advised Yara International ASA with Nazir Takieddine (Picture), Clarissa Machado, Reinaldo Ravelli, Bruno Dreifus and Luisa Kirchhof.

Cescon, Barrieu, Flesch & Barreto advised the selling shareholders with Joaquim Oliveira, Darkson Galvão, Ramon Castilho, Leandro Corrêa, Juliana Carvalho and Andreza Ribeiro.

Candido Martins advised the Galvani family with Alamy Candido, Renata Simon and Paola Sarraf.

Involved fees earner: Alamy Candido – Candido Martins; Paola Sarraf – Candido Martins; Renata Simon – Candido Martins; Nazir Takieddine – Trench, Rossi and Watanabe Advogados; Bruno von Dreifus – Trench, Rossi and Watanabe Advogados; Clarissa Giannetti Machado – Trench, Rossi and Watanabe Advogados; Reinaldo Ravelli – Trench, Rossi and Watanabe Advogados; Joaquim José Aceturi de Oliveira – Cescon, Barrieu, Flesch & Barreto; Darkson Delmondes Galvão – Cescon, Barrieu, Flesch & Barreto; Leandro Tavares Corrêa Pinto – Cescon, Barrieu, Flesch & Barreto; Ramon Machado Castilho – Cescon, Barrieu, Flesch & Barreto; Andreza de Souza Ribeiro Fonseca – Cescon, Barrieu, Flesch & Barreto;

Law Firms: Candido Martins; Trench, Rossi and Watanabe Advogados; Cescon, Barrieu, Flesch & Barreto;

Clients: Yara International ASA; Galvani Family;

Author: Ambrogio Visconti.