Borealis said it will initiate mandatory information and consultation procedures with employee representatives “shortly.” If the green light is given as expected, the transaction will close in the second half of 2022, subject to certain closing conditions including regulatory approval.

For some time, the Vienna-based company has been looking for a buyer for the agriculture business to concentrate on olefins and polyolefins, including the Borouge joint venture in the United Arab Emirates. In February it announced plans for a sale to Russian-owned, Swiss-based fertilizer producer EuroChem for €455 million but pulled the plug on the deal in March, following Russia’s invasion of Ukraine.

EuroChem’s owner Andrey Melnichenko, who is considered to be one of the wealthiest Russians with a net worth of more than $13 billion, is one of several Russian oligarchs believed to have close ties to Russian president Vladimir Putin.

The assets set to change hands have annual revenue of €908 million. The large gap between the latest offer and the original selling price agreed suggests that buyer had agreed to assume substantial debt, observers said.

In view of Borealis’ nitrogen production assets in Austria, Germany and France as well as a comprehensive sales and distribution network that utilizes the Danube River, this business combination would well complement Agrofert’s existing capabilities in Europe, the partners to the transaction said.

Agrofert’s activities, concentrated in the central European region, span a number of industries from chemicals and agriculture to food production. Its holdings comprising more than 200 companies with 31,000 employees generated consolidated turnover of € 7.5 billion in 2021. The company is one of the leading European nitrogen fertilizer producers, with manufacturing facilities in Germany, the Czech Republic and Slovakia.

Author: Dede Williams, Freelance Journalist