TORONTO, ONTARIO -- (Marketwire) -- 07/16/10 -- Hanfeng Evergreen Inc. ('Hanfeng' or the 'Company') (TSX: HF) a leading producer of slow and controlled release fertilizers in China, announced today that Hanfeng and Agrium Inc. (Agrium) have agreed that Hanfeng will purchase Agrium's ownership in Hanfeng's subsidiary responsible for developing Sulphur Coated Urea ('SCU'), known as Hanfeng Slow Release Fertilizer (Canada) Co. Ltd. (or 'Subco'). Hanfeng will purchase Agrium's 50 percent ownership in Subco for $2.3 million in cash plus Agrium will receive 100,000 shares in the parent company, Hanfeng. As a result, Agrium's ownership in Hanfeng will increase from 19.4 percent to 19.6 percent effective July 16, 2010. The transaction is subject to TSX approval. The purchase of Subco by Hanfeng is not expected to have a material effect on either the Company's EBITDA(i) or earnings per share.
Agrium had acquired its 50 percent interest in Subco in April 2009 through the exercise of an option granted under the agreements pursuant to which Agrium became a shareholder of Hanfeng, in April 2007. Subco's assets include a 50,000 metric tonne per annum SCU facility in Shanxi province, China, and the perpetual license for SCU production in China. The sale is a result of Hanfeng broadening its strategic focus to building facilities that have a broad range of products including SCU.
About Agrium Inc.
Agrium Inc. is a major retail supplier of agricultural products and services in both North and South America and a leading global producer and marketer of agricultural nutrients and industrial products. Agrium produces and markets three primary groups of nutrients: nitrogen, phosphate and potash as well as controlled release fertilizers and micronutrients. Agrium's strategy is to grow through incremental expansion of its existing operations and acquisitions as well as the development, commercialization and marketing of new products and international opportunities. Contact us at: http://www.agrium.com/.
About Hanfeng Evergreen Inc.
Hanfeng is the largest producer of slow and controlled release fertilizers in China. It was the first company to introduce the concept of slow and controlled release fertilizers into China's agriculture market with its establishment of the first commercial scale production in China. All production facilities are located in prime agricultural regions of China. The Company is headquartered in Toronto, Ontario and its shares trade on the Toronto Stock Exchange. www.hanfengevergreen.com
This press release contains forward-looking statements based on current expectations. These forward-looking statements entail various risks and uncertainties that could cause actual results to differ materially from those reflected in these forward-looking statements. Risks and uncertainties about Hanfeng's business are more fully discussed in the Company's disclosure materials, including its annual information form and MD&A, filed with the securities regulatory authorities in Canada. All amounts are stated in Canadian dollars except for noted otherwise.
(i)EBITDA is defined as earnings before interest, taxes, depreciation and amortization.
Hanfeng Evergreen Inc.
Chief Financial Officer
Spinnaker Capital Markets Inc.