Israeli minister opposes chemicals sale to Potash Corp.

Israel’s new Finance Minister Yair Lapid said he’d “adamantly oppose” the sale of fertilizer producer Israel Chemicals Ltd. to Canada’s Potash Corp. of SaskatchewanInc., threatening to block what could have been the Mideast’s biggest takeover.

“This could be the final nail in the coffin for the deal,” Richard Gussow, an analyst at DS Securities & Investments in Tel Aviv, said Wednesday.

Lapid, 49, also put ICL and other resource developers on notice that he would reconsider how they’re taxed. Shares in the Israeli fertilizer producer, which mines minerals from the Dead Sea, sank.

The proposed acquisition of ICL, Israel’s second-largest publicly traded company, would create the world’s biggest producer of potash, a nutrient that helps crops withstand drought and strengthens plant root systems. Optimism that a deal would materialize helped boost Israel Chemical’s stock 5.3 per cent in the three months ending March 31.

Still, some lawmakers and unions had opposed the deal, and no formal offer had been made.

“Israel’s natural resources are a public asset and the Israeli public should be the first to benefit from them,” Lapid said in an emailed statement Wednesday.

Shares in Israel Chemicals ended the day down 3.85 per cent to 46 shekels in Tel Aviv, the lowest closing price since Jan. 8. Israel Corp., its parent company, dropped 5.9 per cent to 2,483 shekels ($695)

The Lapid announcement makes the deal “extremely unlikely,” said Gilad Alper, a senior analyst at Excellence Nessuah Brokerage Ltd.

Lapid, a political newcomer, had stated his opposition to such a deal while campaigning for office. His declaration Wednesday, less than a month after he became finance minister, made his objections “extra official and extra emphatic,” Alper said.

“The real story, however, is that Lapid is considering setting up a public committee to discuss how the state is taxing natural resources,” Alper said. “This is triple worse.”