Israel Chemicals Ltd. (TASE: ICL) and Dutch company AkzoNobel (AEX: AKZO) have signed a non-binding Memorandum of Understanding to collaborate on the long-term production and marketing of vacuum salt and white potash.
The MOU signed by AkzoNobel Chemicals International B.V and Israel Chemical’s Spanish subsidiary, ICL Iberia, calls for the production and marketing of 1.5 million tons of high quality vacuum salt, as well as 50,000 tons of white potash utilizing best-in-class available technology.
High purity vacuum salt, manufactured from a salt by-product of potash mining, is used in a variety of applications by the chemical industry and also applied for specialty grades in the food and feed industries. Under the MOU, the vacuum salt will be produced by a future joint venture between AkzoNobel Chemicals International B.V and ICL Iberia and sold by AkzoNobel Chemicals International B.V. The MOU also calls for AkzoNobel Chemicals International B.V to enter into an off-take agreement with the joint venture for all of the vacuum salt produced by the joint venture. The white potash will be produced and marketed by ICL Iberia.
Israel Chemicals is currently constructing a production facility for the two products at its mining facility located in Suria mine,Catalonia, Spain, within the scope of a previously announced, €170 million Phoenix Project, to increase the company's potash mining and production capacity at its Spanish facilities. .
The parties will benefit from strong synergies including Israel Chemicals extensive mining and production capabilities in Spain, as well as AkzoNobel’s experience and technical know-how to produce the planned volumes of salt and its sales and marketing networks. ICL Iberia’s manufacturing operation to produce the vacuum salt and white potash will be fully sustainable, and will benefit the Central Catalonia region’s employment and manufacturing base, the company said.
Published by Globes [online], Israel business news - www.globes-online.com - on July 9, 2014
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