Fertiglobe to Acquire Wengfu Australia’s Distribution Assets, Strengthening its Presence in a Key Region

• Fertiglobe to acquire the distribution assets of Wengfu Australia Pty Ltd. through an asset sale and purchase agreement, expanding downstream reach and enhancing access to supplying Australian customers. 
• Purchase price will be based on the net asset value – over 90% of which is fully recoverable net working capital – plus a premium of ~US$8 million, with the final amount to be determined at closing, subject to regulatory approvals.
• The normalized working capital level is estimated at around US$75 million, which will be financed through pre-arranged trade and factoring facilities with an expected minimal impact on future dividends and leverage.
• Fertiglobe currently supplies ~600kt of urea annually to Australia, with potential to significantly grow supply volumes through the Wengfu platform to meet demand.  
• Acquisition accelerates Fertiglobe’s expansion into the Asia-Pacific market and supports its strategy to reinforce its position in key regions, build resilience across cycles, and unlock distribution and supply chain synergies.  
• Transaction is expected to be 2.8% and 4.1% earnings per share (EPS) accretive before synergies in 2026 and 2027 respectively. 

 Fertiglobe, the world’s largest seaborne exporter of urea and net ammonia combined, the largest nitrogen fertilizer producer in the Middle East and North Africa region, and ADNOC’s low-carbon ammonia platform, has signed an asset sale and purchase agreement to acquire the distribution assets of Wengfu Australia Pty Ltd. (“Wengfu”), a leading  fertilizer distribution business. The purchase price will be based on the net asset value, consisting of fully recoverable net working capital and liquid inventory, plus a premium of ~US$8 million. The transaction is expected to be earnings per share accretive. 

Wengfu operates in South-East Australia from five ports with eight warehouses, distributing 700-800kt of fertilizers annually, to over 200 customers, with capacity to scale up to 1.1 million tons per annum. This makes Wengfu a leading supplier in one of the world’s fastest-growing agricultural markets, known for high quality standards and a well-established supply chain. Wengfu’s experienced team and longstanding customer relationships will further support the business’s future growth and continuity. 

This acquisition aligns with Fertiglobe’s strategy to expand its presence in key strategic sectors, diversify its global footprint, and build resilience against seasonality. It provides access to a broader customer base, unlocks supply chain efficiencies, and supports the introduction of enhanced-efficiency and sustainable fertilizers. This acquisition also enables Fertiglobe to widen its distributed product portfolio to non-nitrogen fertilizers and allows it to expand fertilizer sourcing flexibility to supply the wider Asia-Pacific region.

The transaction is subject to customary regulatory and legal approvals. 

Ahmed El-Hoshy, Chief Executive Officer of Fertiglobe, commented:  

“Acquiring Wengfu’s assets marks a strategic step in our value-driven growth strategy and accelerates our commercial footprint in Australia – one of the world’s fastest-growing agricultural regions. It also provides us with a strong distribution platform across the Asia-Pacific region, strengthens access to our customers, and enhances our ability to competitively source and deliver our products and services. Having known Wengfu’s team for several years, we have strong confidence in their ability to grow the business from here. The transaction is in line with our ambitions to expand our presence in key markets and reinforces our leadership position in the global nitrogen industry.”

The acquisition will be financed through pre-arranged trade facilities, with no impact on Fertiglobe’s dividend distribution capability and minimal impact on leverage. Fertiglobe’s shareholders recently approved H2 2024 dividends of $125 million, taking total 2024 dividends to $275 million, implying an industry leading yield of +5%.