IMC Global To Sell Its Soda Ash And Boron Chemicals Businesses

Representing an overall reallocation of some $520 million in assets, IMC Global (Northbrook, IL) has signed a definitive agreement to sell its IMC Chemicals soda ash and boron chemicals businesses to Mincorp LLC, organized by the managers of IMC Chemicals. Mincorp is expected to retain its HQ in Overland Park, KS.

Under terms of the agreement, IMC's initial consideration will consist of approximately $400 million of cash and assumed debt, an ongoing minority economic interest in the resulting new company, and the funding by the new company of the purchase of a European soda products facility. The transaction will result in an estimated non-cash, after-tax loss of about $30 million, or $0.26 per share, subject to finalization at closing. IMC Global acquired the soda ash and boron chemicals businesses as part of its purchase of privately held Harris Chemical Group, Inc. and its Australian affiliate, Penrice Soda Products Pty. Ltd., on April 1, 1998. IMC Global is one of the largest 1997 suppliers of phosphate and potash crop nutrients, salt, soda chemicals and sodium bicarbonate; 1997 revenues were nearly $3 billion.

"This is a major step in executing our previously announced asset monetization program," said Robert E. Fowler, Jr., chairman and chief executive officer of IMC Global. "We will use the proceeds from this transaction to retire debt, which will further reduce our ongoing interest expense and materially strengthen our balance sheet." IMC had previously announced layoffs, divestitures (next up: IMC Agribusiness) and plant closings as part of a "profit improvement program."

John Tancredi, current head of IMC Chemicals, will take over management of Mincorp. The company will have estimated annual sales of $430 million. Soda ash is used for making glass, detergents, fiberglass, and many industrial and specialty chemical products.