CPC gives green light for Agropolychim’s acquisition of 20.3% of Neochim
Agropolychim (through its subsidiary Rhea Ventures) has concluded an agreement with the Czech company Agrofert to purchase 100% of the shares in the capital of the Bulgarian company Feboran, which owns a 20.3% stake in Neochim. Further to the notification filed on October 18th, 2024, the Commission on Protection of Competition of Bulgaria has officially notified Rhea Ventures, with a letter dated December 23rd, 2024, that the size of pending transaction does not reach the threshold under the Protection of Competition Act. Hence, no detailed assessment shall be made to determine its effect on competition in the relevant market.
Agropolychim’s vision is that the EU fertilizer industry is undergoing fundamental changes, and only a few nitrogen-producing fertilizer companies in Europe will survive. These changes are caused by the war in Ukraine, the substantial increase in natural gas prices, and the EU Green Deal, which aims to drastically reduce CO2 emissions. Many ammonia-producing factories in the EU, which all emit a lot of CO2 and will not receive free CO2 credits anymore in the near future, will have serious difficulties producing ammonia in a sustainable way and will shut down partially or completely. In the past few months, the industry has already seen some closures of major production units in Western Europe. The only fertilizer producer in Romania has also stopped production with uncertain prospects for the plant’s future.
Neochim’s production facilities can be modernized and transformed in an efficient and sustainable way, including with the help of European green transition and modernization funds, and the company could successfully go through the turbulence of the transition period like very few other companies in Europe are currently able to.
Agropolychim’s involvement as an investor could be crucial to Neochim, given Agropolychim’s strategic position, extensive experience in the successful implementation of a number of big industrial projects and strong financial position. However, it is up to Neochim’s governance bodies to ensure proper management of Neochim’s assets and to draw and propose to the shareholders a detailed strategic plan that could secure the company’s long-term viability.
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Rhea Ventures was incorporated by Agropolychim in August 2024 to identify and pursue opportunities for equity and debt investments in companies from industrial sectors that are related to its core business – agriculture, chemicals, transportation and logistics, where through synergies and expertise from the Agropolychim Group added value can be created and/or unlocked.
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