Yara mulls IPO of clean ammonia business
Norwegian chemical company Yara International is evaluating a potential initial public offering (IPO) of its Yara Clean Ammonia business (YCA) on the Oslo Stock Exchange.
As explained, the evaluation of a potential future listing is focused on attracting minority investors and reflects Yara’s strategic ambition to enable the hydrogen economy, where clean ammonia will play a crucial role within zero-emission shipping fuels, power generation, green fertilizer production and other industrial applications.
YCA was established as a separate segment and business unit in February 2021 to focus on clean ammonia, i.e. green and blue ammonia.
Subsequently, the Norwegian company said that YCA would be set up as a separate legal entity and that Yara would maintain majority ownership.
A potential IPO would raise capital to accelerate the growth of YCA, visualize the value of the business better and support increased management focus – for both firms.
“The decision to evaluate a potential IPO of Yara Clean Ammonia represents a natural next step as Yara executes its strategy to broaden its business model. YCA remains core to Yara’s strategy and Yara will continue to provide long-term backing to YCA as its majority owner and preferred partner,” Svein Tore Holsether, CEO and President of Yara, commented.
Clean ammonia offers a solution to the decarbonization of hard-to-abate sectors, such as shipping, power generation and agriculture. New use-cases represent major opportunities on top of the existing structurally robust ammonia market, with the size of the global ammonia market expected to more than double in volume by 2050. This is anticipated to lead to shifts in trade flows and increased trading of ammonia, which will significantly increase the importance of YCA’s midstream value chain position.
As a preparatory step in the event of a potential future IPO, Yara will initiate an internal process to organize YCA assets, contracts, etc. into dedicated YCA entities/subsidiaries that, for now, will remain under Yara’s ownership.
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