By Nate Wolf
Shares of Air Products & Chemicals fell sharply Monday after the world's largest hydrogen supplier said it was in talks with ammonia company Yara International to form a production and distribution partnership.
The collaboration would encompass two ongoing projects. First, Yara would acquire the ammonia facilities at Air Products' low-carbon energy complex in Louisiana for an estimated $8 billion to $9 billion. In turn, Air Products would supply 80% of the hydrogen to Yara to support its ammonia production under a 25-year agreement.
The second prong of the agreement would be the NEOM Green Hydrogen Project in Saudi Arabia, which is expected to begin commercial production in 2027. Air Products and Yara plan to reach an agreement in which Yara would sell the ammonia not sold by Air Products on a commission basis.
Air Products stock dropped 7.5%, making it the worst performer in the S&P 500 on the day. Monday was the stock's largest single-day decline since Feb. 5, 2024, according to Dow Jones Market Data.
The two companies explained the partnership as a way to "meet increasing demand for low-emission ammonia in the coming years." Air Products produces hydrogen and ammonia at scale, while Yara is the world's largest trader and shipper of ammonia.
Investors likely want to see the details of the agreements, though, to understand the benefits each side will realize and the risks they will assume.
Norway-traded shares of Yara closed trading up 0.9% on Monday.
Write to Nate Wolf at nate.wolf@barrons.com
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(END) Dow Jones Newswires
December 08, 2025 12:03 ET (17:03 GMT)
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