Russia, Belarus want potash company Soyuzkali proposals by Sept 1
MOSCOW. July 20 (Interfax) - Russia and Belarus want proposals on the formation of a new potash company, Soyuzkali, by September 1.
First Deputy Prime Minister Igor Shuvalov and Belarusian Deputy Prime Minister Sergei Rumas asked Belneftekhim and the Russian Industry and Trade Ministry to draft the proposals in conjunction with potash miners Uralkali and Belaruskali, a source from one of the integration structures told Interfax.
The source said the new company would be registered in Switzerland.
Soyuzkali will be a joint venture between Belarusian Potash Company (BPC), Belaruskali and Uralkali, Belarusian First Deputy Prime Minister Vladimir Semashko has said. It will be registered by the end of this year or early 2013.
The new company "will receive a whole range of new opportunities, connected with both tax breaks and access to bank credit resources," Semashko said.
The main purpose of creating Soyuzkali is to secure access to cheap loan resources. "Soyuzkali is a company that has to be registered in Switzerland. It will be a Swiss business entity with a certain preferential tax regime. However, the most important is that it will have access to cheap loan resources. For the development of Uralkali, Belaruskali and the sales structure itself, cheap resources are needed," Semashko said earlier.
The new company, to which BPC's functions will be transferred and which will be the exclusive trader for Belaruskali and Uralkali, will start functioning in February 2013. "BPC will be kept for awhile, with several functions," Semashko added.
Belaruskali and Uralkali founded BPC on an equal footing in April 2005. In May 2008, Belaruskali transferred 5% of BPC shares to state-owned enterprise Belarusian Railways. Uralkali's stake remained unchanged at 50%
BPC is the largest potash exporter, with a 43% share of the world market. It delivers mineral fertilizers to over 70 countries and is continuing to enter new markets.
The decision to change BPC's name and jurisdiction was made at the senior level of the Belarusian and Russian leadership.