Orica announced that it has signed an agreement with CF Industries Sales LLC and CF Industries Nitrogen LLC to settle litigation that began in October 2023. The settlement involves a payment of US$169.5 million to CF in the second half of fiscal year 2026, funded from existing cash and undrawn, committed bank debt facilities. The resolution was reached on a commercial basis, with no admission of liability by any party.
Following this outcome, Orica said it will seek new long-term contracts for ammonium nitrate supply into its U.S. business, supplementing its global network to ensure a diversified and secure supply base. This move is aimed at supporting customers and driving profitable growth in a key region. Despite CF's claimed force majeure notice in November 2025 and the subsequent plant closure, Orica has successfully leveraged its global manufacturing and supply network to maintain uninterrupted customer supply.
In addition, Orica has entered into an agreement with Nelson Brothers Inc., its current 50:50 joint venture partner, to acquire full ownership of Nelson Brothers LLC and Nelson Brothers Mining Services, LLC. Through this transaction, Orica will gain complete control of the joint ventures' U.S. explosives business, while Nelson Brothers will acquire the specialty chemicals business unit.
Under the agreement, Orica will pay US$25 million to Nelson Brothers Inc. and retire US$48 million of existing debt in the explosives business. The transaction is expected to close in the second half of fiscal year 2026 and be earnings per share accretive in the first full financial year of ownership. Combined with the CF settlement, the deal is highly synergistic, with an anticipated EBIT uplift of around A$35 million per annum once fully integrated, alongside further revenue growth and cost synergies.
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May 01, 2026 15:54 ET Central banks dominated the economics news flow this week with almost all major ones announcing their latest policy decisions and many boosted expectations for a rate hike in June. In other news, several countries released the preliminary data for first quarter economic growth. In the U.S., comments by Fed Chair Jerome Powell were also in focus as his term ends this month.