Canada's Nutrien (TSX, NYSE:NTR), the world's largest potash miner, said Monday it was selling its 28%-stake in Arab Potash Co to China's State Development and Investment Corp (SDIC), for $502 million.
SDIC Mining Investment, a subsidiary of SDIC, will become the majority shareholder in Arab Potash after the transaction, which is expected to further reduce China's reliance on potash imports and guarantee its food security.
Selling the stake in Arab Potash was required by Indian and Chinese regulators to clear the merger of Agrium and PotashCorp, which formed Nutrien.In May, Nutrien sold its 24% stake in Chile's Chemical and Mining Society (SQM), one of the world's top lithium producers, to another Chinese company - Tianqi. The $4.1 billion-deal, currently being probed Chile's antitrust regulator, allowed Beijing to tighten its grip on the global supply chain for battery raw materials
Arab Potash is primarily involved in harvesting minerals from the Dead Sea. It's the world's eighth largest potash producer by volume of production and the sole Arab producer of the fertilizer ingredient.
China, in turn, is the top consumer of potash in the world.
As with SQM, selling Arab Potash stake was required by the Competition Commission of India and Ministry of Commerce in China in providing their clearance for the merger of Agrium and PotashCorp to form Nutrien.
Shares in Nutrien were trading slightly lower on Monday morning in Toronto (-0.57% to Cdn$ 68.44) and New York (-0.65% to $52.11) by 10:21 Am ET.