K+S puts Americas salt business on auction block to slash debt

By Ludwig Burger

FRANKFURT (Reuters) – German minerals firm K+S said on Wednesday it would sell its salt business in North and South America to slash its debt pile and to focus on potash fertilizer products.

“It is the best option to achieve the urgently required reduction of the company’s debt,” Chief Executive Officer Burkhard Lohr said in a statement.

The planned sale of the salt unit – which is the world’s largest salt supplier and owner of the Morton Salt brand – would allow the company to reduce its net debt by more than 2 billion euros ($2.3 billion), when combined with major restructuring measures, the company said.

Its shares were up 11.2% at 1350 GMT.

The move marks a change from plans laid out in December to look into strategic options for the salt business in the Americas, with a preference for a stake sale which could be done via an initial public offering.

Deliberations to sell a stake in its Bethune potash mine in Canada, also unveiled in December, are no longer on the agenda, the company said.

It added it expected 2020 earnings before interest, taxes, depreciation and amortization (EBITDA) of 500-620 million euros, down from 640 million in 2019, as lower prices for farming fertilisers will temper larger sales volumes and amid weak demand for de-icing salt.

EBITDA rose 6% last year, on flat sales of just over 4 billion euros.

(Reporting by Ludwig Burger, editing by Thomas Escritt and Mark Potter)