Potash Corp Plans no Layoffs or Closures of K+S Mines

Potash Corp Plans no Layoffs or Closures of K+S Mines

Canada’s potash giant Potash Corp said it had no plans to shut down the complex of mines belonging to the German rival K+S AG. Potash Corp wants to acquire K+S AG in a courting process that it started in February this year. Analysts earlier suggested that the acquisition of the German company could prompt Potash Corp to look into a few high-cost German mines – a move, which would likely trigger opposition of the German government.

Volker Bouffier, Premier of Hesse, the region of Germany where K+S is based, already made himself clear that “jobs mustn’t be at risk”, adding that he offered the company’s CEO support in protecting employment. Observers further suggest that Potash Corp could also look into another mine that K+S is building in Canada hoping to gain a tighter control of potash supply in North America.

In contrast to analysts’ predictions, Potash Corp reportedly informed K+S that it was planning no shutdowns or layoffs. On the contrary, the Canadian potash company said it would establish its European headquarters in Germany as part of the acquisition and it would also continue the construction of the K+S mine in Canada.

The amount for which Potash Corp wants to buy its rival is unknown but the bid is said to represent about 60 percent premium to the German company’s 12-month trailing average stock price of 26 euros before the stock’s surge last week, ensuing Potash Corp’s proposal. K+S is Europe’s biggest supplier of potash as well as the world’s largest salt producer. The company also distributes other mineral fertilizers, such as potting soils or magnesium salts.