On Friday, January 10th, 2014 KGHM Polska Miedź, Grupa Azoty “PUŁAWY” and Gdańskie Zakłady Nawozów Fosforowych “Fosfory” signed an agreement concerning cooperation in the search for resources. The document outlines the rules of joint activity of the companies regarding the identification and excavation of potassium salts, raw phosphate materials, salt and non-ferrous metal deposits.
Creation of a special purpose company
The agreement stipulates the scope and schedule of further work on the joint project. One of the essential elements of the document is specifying the details of the investment contract, which will mark the real launch of the common project, and will lead to constituting a special purpose company, as well as the terms of purchasing raw materials and resources from this company. GZNF “Fosfory”, Grupa Azoty “PUŁAWY” and KGHM Polska Miedź are to apply for corporate consent and seek an antitrust approval from the Office of Competition and Consumer Protection, so as to establish a new entity without problems.
Market giants joining forces
The Friday agreement has made KGHM Polska Miedź the project leader. The capital share of our companies – Grupa Azoty Zakłady Azotowe “PUŁAWY” and GZNF “Fosfory” (owned by Grupa Azoty “PUŁAWY”) or other Grupa Azoty members in the special purpose company will constitute 50%.
The document from January 10th, 2014 is the next step in the cooperation between the parties, which had singed a Letter of Intent concerning cooperation in exploration projects in August 2013.