Incitec Pivot to review fertilisers business

Chemicals, explosives and fertilisers business Incitec Pivot (ASX: IPL) has announced a review of its fertiliser businesses in Australia and the region.

The company is the sole manufacturer of phosphate fertilisers in Australia and the only producer of nitrogen fertilisers on the east coast.

The company has appointed UBS to provide advice for a strategic review of the business during this financial year, with a purpose of maximisiing shareholder value.

The review will consider a potential sale of the business, a demerger or retaining the business and continuing to invest for growth.

The company suffered a horror year in 2019 marred by two major plant outages and floods in north Queensland which hit phosphate production..

It has also faced difficulties securing long term contracts for gas, with its Gibson Island ammonia plant’s future secured only until 2022 after an exhaustive period of negotiations.

IPL managing director, Jeanne Johns said: “The fertiliser business has made good progress in advancing a number of strategic priorities and growth opportunities.

“Now is a logical time to initiate a strategic review.”

Incitec Pivot owns the global Dyno Noble explosives business and has been invetsing in basic chemicals the US where gas and labour is cheap, and environmental controls weak.

It operates 20 manufacturing plants in the US, Canada, Australia, Mexico, Indonesia and Turkey,

Picture: Incitec Pivot

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