CLEVELAND, March 1 /PRNewswire-FirstCall/ -- OM Group, Inc. announced today that it has completed the previously announced sale of its Nickel business to Norilsk Nickel ("Norilsk") for $408 million in cash on a cash-free/debt-free basis. The company expects to use the proceeds of the transaction to improve its financial flexibility and strengthen its position to grow through tactical and strategic acquisitions, as well as through new product and technology development.
"With the sale of our Nickel business, we simultaneously achieve three mission-critical objectives in our strategic transformation into a diversified specialty chemicals and advanced materials company," said Joseph M. Scaminace, chairman and chief executive officer. "Those objectives are to focus the company on its strengths in developing and producing value-added specialty products for customers that serve dynamic markets; to lessen the impact of metal price volatility on our bottom line; and to support our aggressive growth plans. Achieving these objectives enhances our ability to deliver more predictable and, ultimately, more sustainable financial results over the long term."
Scaminace noted that the company also finalized the terms of the five-year supply agreements with Norilsk's trading subsidiary that will, among other things, further strengthen OMG's supply chain and secure a consistent source of raw materials for its Specialties business.
ABOUT OJSC MMC NORILSK NICKEL OJSC MMC Norilsk Nickel is Russia's largest mining and metallurgical company and the world's largest producer of nickel and palladium, as well as a major producer of platinum and copper. OJSC MMC Norilsk Nickel is listed on the MICEX and RTS Russian stock exchanges (GMKN_RU), and the company's American Depository Receipts are traded over the counter in New York (NILSY_US), London (MNOD_LI) and Berlin (NNIA_GR).
ABOUT OM GROUP, INC.
OM Group is a leading, vertically integrated international producer and marketer of value-added, metal-based specialty chemicals and related materials. Headquartered in Cleveland, Ohio, OM Group operates manufacturing facilities in the Americas, Europe, Asia and Africa. For more information, visit the company's Web site at http://www.omgi.com/.
FORWARD-LOOKING STATEMENTS
The foregoing discussion may include forward-looking statements for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based upon specific assumptions and are subject to uncertainties and factors relating to the company's operations and business environment, all of which are difficult to predict and many of which are beyond the control of the company. These uncertainties and factors could cause actual results of the company to differ materially from those expressed or implied in the forward-looking statements contained in the foregoing discussion. Such uncertainties and factors include: the direction and pace of our strategic transformation, including our use of proceeds from the sale of our Nickel business on March 1, 2007 and identification of potential acquisitions; the speed and sustainability of price changes in cobalt; the potential for lower of cost or market write-downs of the carrying value of inventory necessitated by decreases in the market price of cobalt or the selling prices of the Company's finished products; the availability of competitively priced supplies of raw materials, particularly cobalt; the risk that new or modified internal controls, implemented in response to the 2004 investigation by the audit committee of the Company's board of directors and the Company's examination of its internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act, are not effective and need to be improved; the demand for metal-based specialty chemicals and products in the Company's markets; the effect of fluctuations in currency exchange rates on the Company's international operations; the effect of noncurrency risks of investing and conducting operations in foreign countries, including political, social, economic and regulatory factors; the effect of changes in domestic or international tax laws; the outcome of the previously announced SEC Division of Enforcement review of the investigation conducted by the Company's audit committee; and the general level of global economic activity and demand for the Company's products.
