PotashCorp on Sunday said that it has withdrawn its proposal to acquire German potash producer K+S.
The private proposal of €41/share on 31 May 2015 sought to bring together complementary assets that would have enhanced financial resources and allowed the combined company and its stakeholders to benefit from greater diversification across geographies and products. It reflected a 59% premium to the volume weighted average of K+S’ share price during the prior 12 months and included comprehensive, credible commitments to K+S’ employees, unions and communities, PotashCorp says.
“Our proposal reflected full and fair value, and was predicated on a collaborative process with access to customary due diligence,” said Jochen Tilk, PotashCorp president and CEO. “Since that time, challenging macroeconomic conditions have contributed to a significant decline of global commodity and equity markets, with potash peer stocks down almost 40%.” This is based on average of peer group, which includes Mosaic, Israel Chemicals, and Intrepid Potash but excludes Uralkali because of its expected delisting from exchanges.
“In light of these market conditions and a lack of engagement by K+S management, we have concluded that continued pursuit of a combination is no longer in the best interests of our shareholders,” Tilk says.
PotashCorp will continue to focus on its disciplined growth strategy. With a strong balance sheet, top-tier assets and a track record of operational excellence, PotashCorp believes it is well positioned to capture future opportunities, the company says.
By Natasha Alperowicz
Source: Chemical Week
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