Potash producer Israel Chemicals said on Friday it had made a $109.50 million offer to buy Canada's Allana Potash , a deal it hopes will accelerate development of a mine in Ethiopia.
Israel Chemicals (ICL) already owns 16.36 percent of shares in Allana, whose Danakhil project in northeast Ethiopia could yield up to 1 million tonnes of muriate of potash per year for 25 years. It will pay C$0.50 per share for the remaining shares.
"Acquiring ownership of Allana will enable ICL to control the development of the Danakhil project, accelerate pre-construction engineering design work, as well as secure project financing," ICL said in a statement.
The acquisition, which would be paid for in cash and shares in ICL's common stock, is supported by Allana's board of directors, but is still subject to conditions and regulations, ICL said.
ICL is the second-largest Israeli company on the Tel Aviv Stock Exchange and one of the three largest suppliers of the crop nutrient potash to China, India and Europe.