Norwegian fertilizer producer Yara International ASA has agreed to acquire a 60 percent stake in Brazilian company Galvani Indústria, Comércio e Serviços S/A, expanding its interests in South America.

Galvani is a privately held fertilizer company that has operations in phosphate mining, Single Super Phosphate (SSP) production and distribution of fertilizers in the center and northeast of Brazil. Galvani also holds licenses for two new greenfield phosphate mine projects in Brazil.

Phosphate is a locally important fertilizer product because it is essential for Brazil's soybean industry, Lair Hanzen, head of Yara in Brazil, told Bloomberg.

Yara said on Tuesday that it would purchase the majority stake for an enterprise value of $318 million, comprised of $132 million for the existing business and $186 million for mining and production projects. Yara will also inject $165 million of equity, subject to certain conditions.

The Norwegian company's share of Galvani's debt is $93 million and its total equity exposure will be $390 million.

Additionally, providing that certain project-related conditions are met, the agreements with Galvani commit Yara to support the company's development of three specific mining and associated production projects until 2019. They represent a total capital expenditure of $920 million, of which Yara's share will be $552 million.

In August 2013 Yara completed its purchase of Bunge Ltd.'s fertilizer business in Brazil for $750 million. This latest acquisition further strengthens its position in the region.