The Orica Ltd (ASX: ORI) share price is edging lower today following the company announcing an asset sale. Earlier, the company's shares were unfazed and were slightly in the green. But, the share price has since dipped into negative territory.
At the time of writing, the commercial explosives company's shares are fetching for $13.88 down 0.14%.
Orica divests Minova business
Investors appeared to be unconcerned by the company's latest news, sending the Orica share price drifting.
In its release, Orica advised it has entered into an agreement to sell its Minova ground control business to Aurelius Group.
Founded in 2005, Aurelius is a European-based investment firm that specialises in taking over small-to-medium sized companies. The long-term oriented private equity investor identifies potential opportunities and then develops the assets.
Aurelius has offices in Munich, London, Stockholm, Madrid, Amsterdam, Milan and Luxembourg.
On the other hand, Minova provides ground support products for the mining, construction and energy sectors. Orica originally acquired the business in 2006 and before restructuring in 2016.
Under the deal, Orica will receive $180 million for the Minova business. However, this is subject to regulatory approvals and other customary closing conditions
If satisfied, the transaction is expected to close sometime within the first quarter of the 2022 calendar year.
Orica managing director and CEO, Sanjeev Gandhi said:
The sale of Minova is consistent with our refreshed strategy, which identified Minova as non-core to Orica. This allows us to focus on our four key business verticals of growth – mining; quarry and construction; digital; and mining chemicals.
The Minova business will benefit from new ownership with more focus and capital to support its growth.
Orica share price snapshot
Looking at the past 12 months, the Orica share price is down 11%. The company's shares took a 20% dive earlier this year in February following a shock CEO succession. However, Orica shares quickly rebounded before moving into a horizontal channel for the majority of 2021.
Based on today's price, Orica commands a market capitalisation of roughly $5.66 billion and has approximately 407.52 million shares outstanding.
