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Israeli Fertisiler Maker ICL Closes Investment for 15% of China's Yunnan Yuntianhua.

M2 EQUITYBITES-January 21, 2016-Israeli Fertisiler Maker ICL Closes Investment for 15% of China's Yunnan Yuntianhua

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21 January 2016 - Israeli fertiliser maker ICL (NYSE: ICL) (TASE: ICL) HAS completed a 15% equity investment in Yunnan Yuntianhua Co., Ltd., the parent company of ICL's Yunnan Phosphate Chemicals Group Corp. Ltd phosphates joint venture partner in China, the company said.

YPC is China's leading phosphate producer. The deal is worth USD 250m.

YTH, a Shanghai Stock Exchange listed Company (CH: 600096), issued ICL 199,249,088 new shares of YTH through a private placement for 8.24 RMB/share.

The investment was approved by China's Ministry of Commerce and its Securities Regulatory Commission.

As strategic investors in YTH, ICL will nominate two out of 11 YTH board members, one of whom will be Stefan Borgas, ICL's president and CEO.

ICL's representation on YTH's board, as well as on a phosphate business committee to be established to provide advice and make recommendations related to YTH's phosphate business, and ICL's right to appoint a deputy general manager for each of YTH and two of its subsidiaries, is expected to permit ICL to have oversight over these businesses and to contribute to their growth and profitability.

The Israeli company said its investment in YTH is part of the formation of a phosphate joint venture by ICL and YTH and will deepen their strategic alliance.

ICL takes the lead in managing the operation of YPH JV's business which has become a fully operating business unit of ICL, and whose results will be consolidated into ICL's financial reports.

The JV is expected to provide ICL with a platform to penetrate growing Asian specialty phosphate markets.

Over the next five years ICL and YTH plan to build specialty plants and triple the JV's white phosphoric acid capacity.

The partners have also established a phosphate R/D platform in Kunming (Yunnan province) which is focused on developing next-generation phosphate-based products and process technologies for the YPH JV and their respective businesses.

ICL is a global manufacturer of products based on specialty minerals that fulfill humanity's essential needs primarily in three markets: agriculture, food and engineered materials.

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Publication:M2 EquityBites (EQB)
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Date:Jan 21, 2016
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