Agrium CEO Presses CF For Talks; Refiling Antitrust Request
24 June 2009 - 1:54AM
Dow Jones News
The top executive at Agrium Inc. (AGU) said Tuesday he expected
the board of takeover target CF Industries Holdings Inc. (CF) to
engage in talks after CF shareholders tendered 62% of their
holdings in support of Agrium's $3.89 billion offer.
The four-month battle among three North American fertilizer
makers showed no signs of weakening, however, as CF maintained its
shareholders do not back the price of an offer from Agrium it
claims may be blocked by regulators.
Agrium Chief Executive Mike Wilson said that "there were no
material impediments" to U.S. antitrust approval and called on CF
to engage in talks.
"I can't believe they are going to ignore their shareholders'
wishes," he told Dow Jones Newswires after the tender offer result
was announced.
Wilson said Agrium would refile its Hart-Scott-Rodino request
for antitrust clearance "shortly," having withdrawn it in late
May.
CF maintains regulatory hurdles remain a key barrier to engaging
in talks with Agrium, as CF continues its own pursuit of Terra
Industries Inc. (TRA), a smaller U.S. fertilizer maker that has so
far resisted CF's approach.
CF maintained the 62% tender offer result did not constitute
majority backing for Agrium's cash-and-stock offer.
Agrium had threatened to walk away if it didn't win enough
backing in the tender offer, while CF has maintained Agrium was
trying to break up its pursuit of Terra.
The often testy three-way contest comes against the background
of weak conditions in the fertilizer market despite crop prices
that remain well above their five-year average.
Agrium's Wilson insists his company remains committed to
acquiring CF, a move that would add CF's wholesale distribution
strength and expand Agrium's own presence in nitrogen and
phosphate-based products.
Share prices in all three companies have fallen in recent weeks,
and Wilson said market conditions remained "fairly tough," with no
recovery expected before the fourth quarter.
CF Chairman and Chief Executive Stephen Wilson said in a
statement that the tender results "do not change the facts that
Agrium's offer substantially undervalues CF Industries, our
shareholders do not support the price in the offer and the offer
has significant regulatory issues."
On Friday, CF extended its $2.93 billion tender offer for Terra
to July 10.
Shares of all three companies were higher Tuesday. Agrium shares
were up 1.8% at $39.60, Terra stock was up 2.8% at $25.46, and CF
was 3.3% higher at $71.63.
Agrium's latest bid is $40 and one share of its stock for each
share of CF. That values CF at $79.23 share, a 14% premium to
Monday's closing price of $69.32.
-By Doug Cameron, Dow Jones Newswires; 312-750-4135;
doug.cameron@dowjones.com
(Tess Stynes contributed to this article.)