Food Machinery Corp. (FMC) announced on March 10 plans to separate into two independent public companies: New FMC and FMC Minerals. New FMC will be comprised of FMC’s current Agri-cultural Solutions and Health and Nutrition segments; FMC Minerals will be comprised of its current Mineralssegment, which includes its Alkali Chemicals and Lithium businesses.


The company expects the separation, which remains subject to final board approval and other customary conditions, to take the form of a tax-free distribution of shares to existing FMC shareholders. The company expects to complete the separation in early 2015, with each new com­pany to be listed on the New York Stock Exchange. 


FMC’s Alkali Chemicals business is the largest global producer of natural soda ash and has its resource base in the Green River, Wyoming, trona district. The company uses low-cost technologies to extract trona ore to produce soda ash and related products used in the glass, chemical processing and detergent industries. 


The company’s Lithium business has its resource base in northern Argentina and is the only brine-to-metals producer with a broad global product portfolio, selling into the energy storage, pharmaceuticals, polymers and industrial markets. Underlying market demand for lithium remains strong, driven by growth in energy storage from electric vehicle adoption and other applications, the FMC announcement stated.


Based on the midpoint of the FMC’s February 2014 outlook, revenue and earnings for its Minerals segment in 2014 are expected to be approximately $1 billion, up 7% from 2013, and $153 million, up 19% from 2013, respectively. As an independent company, FMC Minerals is expected to generate strong cash flow and have the flexibility to pursue select investment opportunities.


Based on the midpoint of the company’s February outlook, combined reve-nue and earnings for the Agricultural Solutions and Health and Nutrition segments in 2014 are expected to be approximately $3.35 billion, up 16% from 2013, and $815 million, up 15% from 2013, respectively.


Pierre Brondeau, FMC Corp. president, CEO and chairman, said, “We believe that creating two companies, each with its own publicly listed equity, will enable the management of each company to pursue its own strategy. This will give each company greater focus on the success factors that are most important to its business and allow the adoption of a capital structure that is appropriate to its business profile.”


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