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Om Group to sell downstream part of legacy business for up to $435 million
(Reuters) - Diversified specialty chemicals company Om Group Inc (OMG.N) said it will exit its core advanced materials business and sell its downstream part to a joint venture led by Freeport-McMoRan Copper & Gold Inc (FCX.N) in a deal valued up to $435 million.
The sale will include Om Group's cobalt refinery assets in Kokkola, Finland.
"(The divestiture) is consistent with our strategy to move up the value chain into technology-based businesses," Chief Executive Joe Scaminace said.
The joint venture also includes Canada-based Lundin Mining Corp (LUN.TO) and Congo's state-owned mining company Gecamines.
Freeport-McMoRan will own 56 percent and be the operator of the joint venture. Lundin will hold 24 percent and Gecamines the rest, Lundin said.
The sell-off will comprise an initial payment of $325 million, Om Group said. It will receive up to $110 million, based on revenue targets, over the next three years.
The company, which also authorized a $50 million share buyback, said it expects the sale to be completed before the end of April 2013.
The advanced materials business brought in 42 percent of Om Group's revenue in 2011, according to Thomson Reuters data.
(Reporting by Krithika Krishnamurthy in Bangalore; Editing by Joyjeet Das)
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