Potash Corp keeps sights on buying K+S, vows to protect jobs

Thu Jul 30, 2015 4:59pm EDT
 
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By Shubhankar Chakravorty and Rod Nickel

(Reuters) - Canada's Potash Corp of Saskatchewan Inc (POT.TO: Quote) (POT.N: Quote) remains focused on acquiring German salt and fertilizer company K+S (SDFGn.DE: Quote), the company said on Thursday, and is prepared to make "binding commitments" to maintain jobs and keep mines running to get a deal.

If it acquires K+S, Potash Corp, the world's biggest fertilizer producer, would finish building K+S's Saskatchewan mine and sell its potash offshore through Canpotex, Chief Executive Jochen Tilk said during a conference call. Canpotex is a sales partnership with Mosaic Co (MOS.N: Quote) and Agrium Inc (AGU.TO: Quote).

"This combination would create a more efficient, integrated company able to prosper in an increasingly competitive global marketplace with expanding global capacity," Tilk said.

Potash Corp said it intends to talk with K+S management, despite K+S's rejection this month of Potash Corp's 7.9 billion euro ($8.65 billion) bid of 41 euros per share.

Tilk's comments are "nothing new," and provide no basis for talks, K+S spokesman Michael Wudonig said.

K+S has suggested Potash plans to shrink the company. Analysts have speculated Potash wants to acquire K+S, a higher-cost producer, to shut some production to support prices.

Tilk said reducing operating costs remains his goal.

Potash Corp stock edged up 0.8 percent to $27.06 in New York, paring earlier gains, after hitting a 52-week low Wednesday.   Continued...

 
Chris McKay, PotashCorp load-out supervisor at the Cory Mine, examines potash inside one of the storage facilities near Saskatoon, Saskatchewan October 10, 2013.   REUTERS/David Stobbe