Australian chemical company Orica (OTCPK:OCLDF) (OTCPK:OCLDY) said Tuesday it agreed to acquire U.S. sodium cyanide producer Cyanco from Cerberus Capital Management for US$640M, in an effort to expand its geographical reach in mining chemicals.
Cyanco produces NaCN, a specialized chemical required for gold processing, at its U.S. plants in Nevada and Texas, and supplies it primarily to gold mining industries across parts of the Americas and Africa.
Orica (OTCPK:OCLDF) (OTCPK:OCLDY) said the addition of Cyanco’s two manufacturing plants will more than double its sodium cyanide production capacity.
The Australian company said it expects the acquisition will be accretive to earnings per share in mid-single-digits in the first year after closing and provide “strong EBITDA margins” benefits.