New York-based private equity firm Cartesian Capital announced Monday that it has reached an agreement to recapitalize its portfolio fertilizer company Intercontinental Potash Corp (ICP).
Cartesian affiliates provided an undisclosed amount to fund the recap and gain an additional ownership stake in ICP. The firm did not respond to requests from Agri Investor to comment further.
ICP is the owner of the Ochoa Polyhalite Project located in southeastern New Mexico, which is thought to contain 300 million tons of polyhalite and is fully permitted to begin production in 2019, according to an investor presentation on the firm’s website.
Polyhalite is a multi-nutrient that is applied directly to crops including tobacco, vegetables and coffee and can be used to increase yields in salty, sandy or arid regions, according to ICP’s website.
“The Ochoa Project is ideally positioned to be a low-cost producer of rapidly-emerging organic fertilizer, serving major markets in the Americas,” said managing partner Peter Yu in a company statement. “As market leaders like Sirius Minerals and Israel Chemicals have demonstrated, polyhalite is the fertilizer of the future.”
Johanna Mirenda, technical director of the Organic Materials Review Institute (OMRI), confirmed to Agri Investor in an email that as a non-synthetic mined material, polyhalite is permitted by the USDA’s National Organic Program.
“Polyhalite would be permitted for use as a fertilizer in organic production, provided that it is a mined source and that the material is not combined with any prohibited material (e.g. synthetic dust suppressants) and is not processed with chemical or heat treatments that would cause chemical change,” she wrote.
Ochoa project manager Graham Wheelock said in the statement that ICP had already received interest from several leading global fertilizer producers and was in the process of negotiating agreements that would account for nearly half of the planned production from the site.
Cartesian is a private equity fund with $2.4 billion in assets under management. Spun out from AIG Capital in 2006, the firm is headquartered in New York and maintains offices in Sao Paolo, Bermuda, Warsaw, Istanbul and Shanghai.
Among others looking to capitalize on polyhalite investments, in October Gina Reinhart’s Hancock Prospecting invested $300 million in Sirius Minerals, a UK-based fertilizer business that is developing a polyhalite mine in North Yorkshire.