SOUTH AFRICA – Johannesburg Stock Exchange (JSE) listed chemicals group Omnia Holdings has reached an agreement to sell its Oro Agri business unit to Rovensa, a Portugal based business that procures and distributes biocontrol, bio nutrition and crop protection solutions.
In June this year, Omnia received a nonbinding offer for the business which warranted further investigation and consideration.
Omnia Chief Executive Officer Seelan Gobalsamy says the board undertook a comprehensive review of Oro Agri as part of the group’s broader strategy and has concluded to accept Rovensa’s attractive offer while recommending that shareholders approve the transaction during a general meeting scheduled for December 14.
Rovensa’s offer is based on an enterprise value of $165 million for Oro Agri which will translate to aggregate cash proceeds of about $152 million for Omnia.
Omnia acquired Oro Agri for $100 million in 2018.
Gobalsamy explained that Rovensa has more synergies with Oro Agri as well as capacity to fund the agribusiness’ growth plan.
Omnia plans to use the proceeds from the disposal to pay down debt and position the group with a strong financial base from which to fund selective organic expansionary capital expenditure and working capital.
The company is currently reviewing its dividend policy as well as considering a special dividend or share buyback programme which will be announced with its results for the year ending March 2021.
Omnia has a far-reaching international footprint with attractive opportunities for its Agriculture International and Mining International businesses despite the disposal.
Omnia’s Agriculture International business which represents about 20% of the company’s international income, is actively growing its bio stimulant, speciality nutrient and organic fertiliser coating product ranges, demand for which, together with demand for humates from Omnia’s unique Australian source, remains high.
Omnia is a diversified Group that conducts research and development, manufactures and supplies chemicals and specialised services and solutions for the agriculture, mining and chemicals application industries.
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