Agrium and Po­tash to merge into global fer­tiliser gi­ant

The Myanmar Times - - International Business -

CANA­DIAN ri­vals Agrium Inc and Po­tash Corp of Saskatchewan have agreed to merge to cre­ate a US$36 bil­lion global fer­tiliser gi­ant in the lat­est large agribusi­ness merger sparked by low crop prices.

The new com­pany will com­bine po­tash, ni­tro­gen and phos­phate pro­duc­tion with a global dis­tri­bu­tion net­work, em­ploy­ing nearly 20,000 peo­ple, and will gen­er­ate $500 mil­lion in an­nual sav­ings from their com­bined op­er­a­tions.

The all-stock deal will cre­ate the largest crop nu­tri­ent com­pany in the world, the com­pa­nies said.

“The new com­pany will be a low-cost, world-class pro­ducer of key crop nu­tri­ents in­clud­ing hav­ing the low­est-cost po­tash pro­duc­tion as­sets and re­serves in North Amer­ica,” Agrium chief ex­ec­u­tive Charles Ma­gro told an­a­lysts.

The new com­pany, which has not yet been named, will be based in Saska­toon, Saskatchewan, and be 52 per­cent owned by Po­tash share­hold­ers, with Agrium own­ers hold­ing 48pc. The two com­pa­nies had com­bined sales of $20.6 bil­lion in 2015.

The deal must, how­ever, still win share­holder sup­port.

The merger comes as the de­mand for fer­tilis­ers is down sharply in emerg­ing coun­tries like Brazil due to the eco­nomic down­turn. Both com­pa­nies also cited weak de­mand in In­dia and other parts of Asia as a rea­son for a drop in earn­ings in the sec­ond quar­ter. –

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