BHP Billiton plc (LON:BLT) begins Potash Corp. (Public, NYSE:POT) takeover

BHP Billiton plc (LON: BLT) is taking takeover process seriously

In brief: Today BHP Billiton plc (LON: BLT) is likely to proceed with a hostile takeover of Potash Corp. (NYSE: POT) for $ 39 billion/

Global mining company BHP Billiton plc (LON: BLT) may proceed with the hostile takeover of fertilizer producer Potash Corp. (NYSE: POT) for $ 39 billion on Wednesday, paving the way for a possible higher offer. BHP Billiton is considering the option of bypassing the Potash Corp. executive board which has already rejected the proposal – the world’s largest takeover bid this year.

The takeover deal will be carried out directly with the Canadian group shareholders. BHP, which aims to become the largest supplier of fertilizers in the world, hired Mackenzie Partners to organize the negotiation process with the Potash Corp. shareholders. Potash Corp. of Saskatchewan Inc. said yesterday that its executive board has received and rejected a takeover bid from BHP Billiton Ltd. for $ 38.49 billion. The fertilizer producer said that the proposal underestimates the real value of the company. Australia’s BHP Billiton offered $ 130 for each share of Potash Corp, i.e. 16 per cent premium to the last closing price. Analysts are inclined to believe that the Australian company will raise its offer, despite the fact that another major mining group – Rio Tinto and Vale – isn’t interested in purchasing the Canadian fertilizer producer.

Igor Tringlers
2010-08-18 14:30, Economics.

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