Unocal to Sell Its Fertilizer Business

Unocal Corp. agreed to sell its fertilizer units to Agrium Inc. for about $325 million in cash and stock so it can focus on its more-profitable oil and natural-gas exploration business. Agrium, Canada’s second-biggest fertilizer company, will pay $250 million in cash, $50 million in convertible preferred stock and $25 million in common stock. El Segundo-based Unocal will receive additional payments if ammonia and urea prices rise above projected levels. The units, Prodica and Alaska Nitrogen Products, employ about 540 people. Agrium said it will keep at least 85% of them. Unocal formed Prodica in September to make its West Coast fertilizer business easier to sell. Unocal shares rose 25 cents to close at $33, while Agrium fell 31 cents to close at $9.63 on the NYSE.