Markets, News, North America, Phosphate, Purified Acids

Shareholders Set to Overwhelmingly Approve PotashCorp-Agrium Merger

The shareholders of Agrium Inc and Potash Corp of Saskatchewan Inc are poised to approve the planned merger of the two Canadian fertilizer producers with an overwhelming ‘yes’ in spite of the initial skepticism. It is expected that about 99 percent of the votes from both sides will be in favor of the merger and about half of them have already come in. Potash Corp Chief Executive Jochen Tilk said on Thursday (27 October) that early votes were “overwhelmingly in favor of the merger.”

The merger requires two-thirds support of votes cast by shareholders of Agrium and Potash. Shareholders of both companies will vote in separate sessions at the beginning of November in Calgary ad Saskatoon, respectively, to say the final ‘yes’ to the deal. The merger will see Potash shareholders owning 52 per cent of the new company and Agrium shareholders holding the rest. However, some Agrium investors were not entirely happy about the deal at the beginning of the transaction, as it would give them greater exposure to the slumping crop nutrient potash. Immediately following the announcement of the deal, Agrium’s shares went down. However, the merger has been embraced by advisory companies Institutional Shareholder Services and Glass Lewis.

The transaction will combine the world’s largest fertilizer company Potash Corp and North America’s largest farm retail business of Agrium. However, the deal will be scrutinized by Canadian and American regulators and the investigations are planned to complete their ‘job’ in mid-2017. In North America, the new company will be responsible for about two-thirds of potash capacity and nearly one-third of phosphate and nitrogen capacity.

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