Manufacturing News

Orica expands with mining chemicals buy

Manufacturing News

Chemicals and explosives manufacturer Orica is to acquire 100 per cent of the common stock of Cyanco Intermediate 4 Corp. (Cyanco) (the Acquisition) from an affiliate of Cerberus Capital Management, L.P. (Cerberus) for US$640 million.

The acquisition of Cyanco, a US-based leader in the manufacture and distribution of sodium cyanide primarily serving the gold mining industries in the US, Canada, Mexico, creates a global manufacturing and distribution network.

The acquisition will be largely funded from Orica’s existing cash and undrawn committed debt facilities, alongside a A$400 million underwritten institutional placement (the Placement).

Orica Managing Director and CEO Sanjeev Gandhi said the acquisition would accelerate the delivery of Orica’s Mining Chemicals strategy and creating a leading global mining chemicals business.

Gandhi said: “Cyanco is a highly complementary business, and by combining it with our established sodium cyanide business, Orica will create a leading integrated global sodium cyanide producer with world-class supply capabilities in mining.

“The acquisition will more than double Orica’s existing sodium cyanide production capacity and provide us with the ability to cater to the highly attractive US and Canadian gold mining industries.”

The acquisition boosts the company’s global network of transfer stations in key gold mining regions.

“The Acquisition is mutually beneficial to both Cyanco and Orica stakeholders, and we look forward to welcoming Cyanco’s employees to Orica. We are excited about the opportunities this will create for Orica, our customers, and our shareholders.”

Global sodium cyanide demand grew at four per cent per annum from 2023 to 2028, with North American sodium cyanide demand growing at five per cent per annum in the same period.

Meanwhile global treated ore is forecast to grow faster than historic rates due to greenfield and brownfield mining projects and decreasing ore grade.

Further reading:
Browse @AuManufacturing’s coverage of Orica here.

Picture: Orica

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