Yara International ASA, Hydros demerged fertilizer business, will be listed on the Oslo Stock Exchange today (ticker: YAR). Hydros global offering of 20 percent of the Yara shares has been priced at NOK 41 per share. The offering was oversubscribed by approximately 20 times the maximum number of shares offered.
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Following the Yara listing, Hydro will concentrate fully on further developing its energy and aluminium businesses.
“We are extremely satisfied with the reception of Yara as an investment opportunity. The interest among both institutional and retail investors confirm the future prospects of Yara, the global leader in the fertilizer industry. The demerger and listing of Yara represent major value creation and potential for both Hydro and Yara shareholders,” said Hydro’s President and CEO, Eivind Reiten.
“Hydro and Yara share nearly 100 years of history. Today, Yara – formerly known as Hydro Agri – sets out on a voyage on its own, under the leadership of Thorleif Enger and his team. Today also marks the beginning of a new era for Hydro; we will strengthen our position by concentrating financial and management resources on further developing the two main business areas, Oil & Energy and Aluminium,” Reiten said.
As a result of the demerger, 80 percent of the Yara shares have been issued to Hydro’s shareholders. Each Hydro shareholder received one Yara share for each share held in Hydro at the close of trading March 24, 2004. Beginning today, the Hydro share (ticker code NHY) will be traded excluding the right to receive Yara shares. Hydro’s American Depository Receipts (ADR) will be traded on the New York Stock Exchange including the right to receive Yara shares through March 31, 2004 and excluding Yara shares from and after April 1, 2004.
Today Hydro has sold 31.9 million Yara shares, representing 10 percent of the new company, with proceeds amounting to NOK 1.3 billion. This will result in a pre-tax gain of approximately NOK 260 million. The gain will be included in income from discontinued operations.
After this sale, Hydro owns another 31.9 million Yara shares, which have been lent to the managers of the global offering to cover overallotments. The managers have been granted an option to buy some or all of these shares on or before April 24, 2004. Hydro expects the managers to exercise this option if the Yara share price does not fall below the offer price during the option period.
Yara will today repay its financial indebtedness to Hydro by drawing on Yara's newly established bank loan facilities.