U.S. challenges deal to merge Canada's Superior Plus, Canexus

Mon Jun 27, 2016 5:12pm EDT
 
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WASHINGTON (Reuters) - U.S. antitrust regulators filed a complaint on Monday to block the proposed merger of Canadian chemical companies Superior Plus Corp SPB.TO and Canexus Corp CUS.TO.

The U.S. Federal Trade Commission said in a statement that the companies are among three major North American producers of sodium chlorate, a chemical used to whiten wood pulp for making paper.

Either company can pull out of the deal as of June 29 under the agreement, Superior said. Discussions to potentially extend that date are ongoing, they said in separate statements.

"Superior is confident that it has a strong case and remains prepared to present a vigorous defense," the company said.

On the Toronto stock exchange, Superior slipped 1.2 percent to C$10.25 and Canexus fell 2.3 percent to C$1.30.

Toronto-based Superior said in October that it would buy chemicals and handling company Canexus Corp, based in Alberta, as it looked to expand its specialty chemicals portfolio.

The FTC valued the deal at $982 million.

Canexus owns sodium chlorate and chlor-alkali plants in Canada and Brazil.

Superior said in a statement last week that it anticipated potential litigation even though it had offered to sell assets that would reduce the company's U.S. market share to 35 percent.   Continued...