Cerberus to Buy Cyanco from Oaktree

Cerberus to Buy Cyanco from Oaktree

Cerberus Capital Management has agreed to acquire Cyanco from Oaktree Capital which acquired the company in October 2008. 

Cyanco is the largest global producer of sodium cyanide, an important raw material input used in the gold and silver mining industry. Sodium cyanide is used in gold cyanidation, a hydrometallurgical technique for extracting gold from low-grade ore by converting the gold to a water-soluble slurry. It is the most commonly used leaching process for gold extraction. Sodium cyanide briquettes – white in color and resembling charcoal briquettes are primarily used by the mining industry. Cyanco’s briquettes are packaged in hopper cars, ISO containers, one metric ton bag/boxes and one metric ton composite packaging.

Cyanco has two production facilities in Winnemucca, NV with a combined production capacity in excess of 240 million pounds annually; a production facility in Pearland, TX that has production capacity of over 120 million pounds annually; delivery terminals in Wyoming, Quebec, and Mexico; and a laboratory facility in Reno, NV. In addition to its production operations, Cyanco’s Applied Technology division provides consulting services, laboratory support, and cyanide processing technologies to assist its customers in maximizing their metal recoveries using sodium cyanide. Cyanco, led by its CEO Jeffrey Davis, is headquartered south of Houston in Pearland, TX (www.cyanco.com).

“We are pleased to acquire Cyanco, an industry leader with a reputation for safety, reliability, and customer service,” said Dev Kapadia, a Managing Director of Cerberus. “We believe in Cyanco’s proven business model, which has demonstrated positive, sustainable growth due to its long-term customer contracts, strong cash flow, and leading competitive position in the attractive sodium-cyanide market. We look forward to working with the management team at Cyanco to provide expansion capital and operational expertise to accelerate the company’s successful growth strategy.”

Cerberus has approximately $34 billion of capital under management and invests in three strategies: global credit opportunities (which includes non-performing loans, corporate credit & distressed debt, mortgage securities & assets, and direct lending); private equity; and real estate. The firm was founded in 1992 and is headquartered in New York (www.cerberuscapital.com).

“This transaction marks the next logical stage in Cyanco’s evolution,” said Cass Traub, a Managing Director of Oaktree. “After working alongside management for the past nine years, we have every confidence that Cerberus and management will create an even greater Cyanco enterprise.”

Oaktree makes investments in distressed debt, corporate debt (including high yield debt and senior loans), control investing, convertible securities, real estate and publicly-traded equities.  The firm has over 900 employees and $100 billion in assets under management and is headquartered in Los Angeles (www.oaktreecapital.com).

© 2018 Private Equity Professional | February 8, 2018

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