March 5, 2020 / 11:15 PM / in a month

UPDATE 1-Australia's Nufarm gets regulatory nod for South American asset divestment

(Adds details about divestment, outlook)

March 6 (Reuters) - Australia’s Nufarm Ltd said on Friday a Brazilian competition regulator has cleared the sale of its South American crop protection and seed treatment assets as it looks to pay down debt amid a severe domestic drought.

In September last year, Nufarm said it would sell Nufarm Brazil to its biggest shareholder, Japan’s Sumitomo Chemical Co Ltd, for about $805 million.

Nufarm said it expects to report interest costs for continuing and discontinued businesses of about A$90 million to A$100 million ($59.52 million to $66.13 million) for fiscal 2020, assuming that the completion of the sale occurs by April 1.

A severe drought in Australia has threatened grain production across the country’s east coast and Nufarm has also taken a hit from flooding in parts of the United States, where it operates several plants.

The sale of assets will allow Nufarm to focus on high-margin crop protection markets in Europe and across North America.

The company reaffirmed its core earnings first half outlook in the range of A$55 million to A$65 million.

$1 = 1.5122 Australian dollars Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Krishna Chandra Eluri and Shailesh Kuber

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