(ReuterS) – German salt and fertilizer company K+S AG (SDFGn.DE) once again rejected Potash Corp of Saskatchewan’s (POT.TO) takeover offer on Friday, saying the Canadian company’s assurances about maintaining jobs and mine sites in Germany were unreliable.
Saskatoon, Saskatchewan-based Potash Corp sent an unsolicited letter to K+S’s management and supervisory boards, K+S said in a statement. The letter included a proposal for a “business combination agreement” based on an unchanged price of 41 euros ($44.82) per share.
The price is too low, and Potash Corp’s commitments on maintaining jobs and keeping mining sites open in Germany are not enforceable, K+S said.
Potash Corp, the world’s second-largest potash miner, wants to acquire No. 5 producer K+S as global competition ramps up among sellers. K+S has suggested Potash plans to shrink the company.
A Potash Corp representative confirmed the company sent a “private letter” to K+S’s boards, but would not comment further.
Shares of Potash Corp eased in New York and Toronto, while K+S stock climbed 1.4 percent in Frankfurt.
Potash Corp has been pushing to talk with K+S management despite the German company’s initial rejection last month of the Canadian company’s 7.9 billion-euro ($8.6 billion) bid of 41 euros per share.
Analysts have speculated Potash wants to acquire K+S, a higher-cost producer, to shut some production to support prices.
People familiar with the situation told Reuters that Potash offered K+S a guarantee it would keep German mines operating for five years.
If it acquires K+S, Potash Corp would finish building the German company’s Canadian mine and sell its potash offshore through Canpotex, Potash Chief Executive Jochen Tilk said on July 30.
By Andreas Cremer and Patricia Weiss (Additional reporting by Rod Nickel in Winnipeg, Manitoba and Greg Roumeliotis in New York; Editing by Michael Shields and Matthew Lewis)
