PotashCorp a step closer to merger with Agrium

The world’s largest fertilizer company has to sell its minority stakes in three foreignowned companies, valued at almost US$4 billion, to secure approval from the Indian government’s antitrust bureau to proceed with its proposed multi-billiondollar merger.

An appellate court said this week that the Competition Commission of India’s approval of Potash Corp. of Saskatchewan Inc.’s proposed merger with Agrium Inc. is conditional on the Saskatoon company selling the holdings within 18 months.

“This is another milestone reached on the road to a successful conclusion of the merger,” PotashCorp spokesman Randy Burton said. “The review process continues in both China and the U.S. and we expect to close the transaction by the end of the fourth quarter of 2017.”

Announced in September 2016, the proposed merger would create Nutrien Ltd., a company valued at US$26 billion with about 20,000 employees and operations in 18 countries.

It would also consolidate six of Saskatchewan’s 10 potash mines.

A lack of communication about how the merger will affect the combined company’s operations means PotashCorp and Agrium miners are working under a cloud of uncertainty, according to the Saskatchewan Potash Council, which represents the province’s unionized miners.

The merger was originally expected to be a done deal by mid2017, but PotashCorp and Agrium said last month that regulatory hurdles pushed back their timeline to the end of the fiscal year but have not affected their plan to save US$500 million by merging.

Under the terms of the deal outlined by the Indian court, PotashCorp must jettison its holdings in Saudi Arabia-based Arab Potash Company (APC), Israel Chemicals, Ltd. and Sociedad Quimica y Minera de Chile S.A. (SCM).

According to its corporate filings, PotashCorp owns 28 per cent of APC, valued at US$600 million and 32 per cent of SCM, which is worth more than US$2.6 billion. The company also has a US$700 million stake in Israel Chemicals.