Compass Minerals (NYSE: CMP), a leading global provider of
essential minerals, today announced that Koch Minerals &
Trading, LLC (KM&T), a diverse global trading, logistics and
investment company and subsidiary of Koch Industries, Inc. (KII),
has completed its $252 million equity investment in Compass
Minerals through the purchase of Compass Minerals common stock.
As previously announced, Compass Minerals expects to use
approximately $200 million of the proceeds from the investment to
advance the first development phase of the company’s previously
identified 2.4 mMT lithium carbonate equivalent (LCE) Great Salt
Lake resource. Compass Minerals anticipates the project’s annual
commercial production capacity to ultimately be approximately 35
kMT LCE, with an initial phase-one capacity of approximately 11 kMT
battery-grade lithium carbonate coming online by 2025.
Compass Minerals expects to use the remaining $52 million of
proceeds from the KM&T investment, less transaction expenses,
to reduce debt.
As part of the agreement, the companies are currently exploring
value creation opportunities across Compass Minerals’ broader
operational platform by leveraging the expansive capabilities of
KII’s many operating subsidiaries, including in the areas of supply
and procurement of fuel and raw materials, freight and logistics,
and project engineering and development support.
Additionally, KM&T may appoint up to two members to the
Compass Minerals board of directors.
Key Transaction Terms
Under the terms of the investment agreement and after all
closing conditions were met, KM&T was issued 6,830,700 shares
of Compass Minerals common stock at a price of $36.87 per share,
resulting in proceeds to Compass Minerals of approximately $252
million.
Perella Weinberg Partners LP acted as sole financial advisor to
Compass Minerals in the transaction and Cleary Gottlieb Steen &
Hamilton LLP acted as the company’s legal advisor. Jones Day acted
as legal advisor for KM&T.
About Compass Minerals
Compass Minerals (NYSE: CMP) is a leading global provider of
essential minerals focused on safely delivering where and when it
matters to help solve nature’s challenges for customers and
communities. The company’s salt products help keep roadways safe
during winter weather and are used in numerous other consumer,
industrial, chemical and agricultural applications. Its plant
nutrition products help improve the quality and yield of crops,
while supporting sustainable agriculture. Additionally, the company
is pursuing development of a sustainable lithium brine resource to
support the North American battery market and is a minority owner
of Fortress North America, a next-generation fire retardant
company. Compass Minerals operates 12 production and packaging
facilities with nearly 2,000 employees throughout the U.S., Canada
and the U.K. Visit compassminerals.com for more information about
the company and its products.
About Koch Industries
Based in Wichita, Kansas, Koch Industries, Inc. is one of the
largest private companies in America, with estimated annual
revenues that have exceeded $125 billion. It owns a diverse group
of companies involved in manufacturing, agriculture, pulp and
paper, packaging, consumer products, building materials, glass,
automotive components, refining, renewable energy, chemicals and
polymers, electronics, enterprise software, data analytics, medical
products, engineered technology, project services, recycling,
supply chain and logistics, global commodities trading, and
investments. Since 2003, Koch companies have invested nearly $150
billion in growth and improvements. With a presence in more than 70
countries, Koch companies employ more than 120,000 people
worldwide, with about half of those in the United States. For more
news and information, visit www.KOCHind.com.
Koch Minerals & Trading, LLC, a subsidiary of KII, is a
diverse global trading, logistics, and investment company with over
500 employees and 1,000 customers in more than 50 countries.
KM&T has significant industry knowledge and experience in
stewarding businesses toward long-term value creation.
Forward Looking Statements and Other Disclaimers
This press release may contain forward-looking statements,
including, without limitation, statements about the company's
lithium brine development project; the KM&T investment;
synergies between the company and KM&T and Koch Industries,
Inc. (KII); ability to leverage KM&T and KII expertise and
build value, progress the lithium project, strengthen the balance
sheet and enhance execution capabilities; use of investment
proceeds; project funding needs; construction of a DLE plant;
eventual LCE production capacity; and value creation opportunities.
Forward-looking statements are those that predict or describe
future events or trends and that do not relate solely to historical
matters. We use words such as “may,” “would,” “could,” “should,”
“will,” “likely,” “expect,” “anticipate,” “believe,” “intend,”
“plan,” “potential,” “future,” “target,” “forecast,” “outlook,”
“project,” “estimate” and similar expressions suggesting future
outcomes or events to identify forward-looking statements or
forward-looking information. These statements are based on the
company’s current expectations and involve risks and uncertainties
that could cause the company’s actual results to differ materially.
The differences could be caused by a number of factors, including,
without limitation, (i) weather conditions, (ii) inflation, the
cost and availability of transportation for the distribution of the
company’s products and foreign exchange rates, (iii) pressure on
prices and impact from competitive products, (iv) any inability by
the company to successfully implement its strategic priorities or
its cost-saving or enterprise optimization initiatives, and (v) the
risk that the company may not realize the expected financial or
other benefits from the proposed development of its lithium mineral
resource or its investment in Fortress North America. For further
information on these and other risks and uncertainties that may
affect the company’s business, see the “Risk Factors” and
“Management’s Discussion and Analysis of Financial Condition and
Results of Operations” sections of the company’s Transition Report
on Form 10-KT for the transition period ended Sept. 30, 2021 and
its Quarterly Reports on Form 10-Q for the quarters ended Dec. 31,
2021, March 31, 2022 and June 30, 2022 filed with the SEC, as well
as the company's other SEC filings. The company undertakes no
obligation to update any forward-looking statements made in this
press release to reflect future events or developments, except as
required by law. Because it is not possible to predict or identify
all such factors, this list cannot be considered a complete set of
all potential risks or uncertainties.
The company has completed an initial assessment to define the
lithium resource at Compass Minerals’ existing operations in
accordance with applicable SEC regulations, including Subpart 1300.
Pursuant to Subpart 1300, mineral resources are not mineral
reserves and do not have demonstrated economic viability. The
company’s mineral resource estimates, including estimates of the
lithium resource, are based on many factors, including assumptions
regarding extraction rates and duration of mining operations, and
the quality of in-place resources. For example, the process
technology for commercial extraction of lithium from brines with
low lithium and high impurity (primarily magnesium) is still
developing. Accordingly, there is no certainty that all or any part
of the lithium mineral resource identified by the company’s initial
assessment will be converted into an economically extractable
mineral reserve.
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version on businesswire.com: https://www.businesswire.com/news/home/20221018006163/en/
Media Contact Rick Axthelm Chief Public Affairs and
Sustainability Officer +1.913.344.9198
MediaRelations@compassminerals.com
Investor Contact Valerie Tymosko Interim Senior Director
of Investor Relations +1.913.344.9496
InvestorRelations@compassminerals.com
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