Norwegian fertilizer producer Yara International is evaluating a potential initial public offering (IPO) of its Yara Clean Ammonia business (YCA) on the Oslo Stock Exchange.
The potential listing is aimed at attracting minority investors and is driven by Yara's ambition to become a major player in the emerging hydrogen sector, where clean ammonia will play a crucial role within zero-emission shipping fuels, power generation, green fertilizer production and other industrial applications.
Yara established YCA as a separate segment and business unit in February 2021 to focus on clean ammonia. Yara subsequently announced that YCA would be set up as a separate legal entity and that Yara would maintain majority ownership. An IPO would raise capital to accelerate the growth of YCA, visualise the value of the business better and support increased management focus, for YCA and Yara.
"The decision to evaluate a potential IPO of YCA 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," Yara chief executive Svein Tore Holsether said.
Banks ABG Sundal Collier and JP Morgan have been retained by Yara to advise on the evaluation of a potential IPO of YCA.
YCA sourced, transported and sold more than 4mn t of ammonia in 2021. Its earnings before interest, taxes, depreciation and amortisation for the 12-month period ending 31 March 2022 was $166mn.
YCA is seeking to expand in the upstream, midstream and downstream sectors of the clean ammonia value chain. As part of this strategic roadmap, the firm has developed a project pipeline with significant investment decisions targeted over the next three years. Yara announced in early April that it had ordered the building of 15 floating terminals to be used to supply green ammonia for bunkering in Scandinavia by 2024.
