CANADA STOCKS-TSX ends sharply higher as Potash soars
* TSX up 175.88 points, or 1.52 percent, at 11,728.64
* Potash Corp soars 26 pct after it rejects BHP bid (Updates to close, adds quotes)
By Jennifer Kwan
TORONTO, Aug 17 (Reuters) - Toronto's main stock index shot higher on Tuesday as Potash Corp POT.TO soared after rejecting an unsolicited $38.6 billion takeover offer from BHP Billiton BHP.AX, raising the prospect of a higher bid and other takeover activity in the fertilizer sector.
Potash Corp of Saskatchewan, the world's biggest fertilizer company, said its board rejected BHP Billiton's offer as "grossly inadequate," and its shares finished the day up 26 percent to C$147.34. [ID:nNSGE67G0D] [ID:nN22340110]
Fellow fertilizer producer Agrium AGU.TO rose 3.5 percent to C$71.19, helping to boost the TSX materials sector by 4.3 percent.
"The price which BHP was seeking to pay was perceived as too low by the company and the market agrees with the company," said Francis Campeau, a broker at MF Global Canada in Montreal.
The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE finished the session up 175.88 points, or 1.52 percent, at 11,728.64. The Potash-driven rally helped to push the index to a peak of 11,744.84, its strongest level in nearly a week.
Bob Gorman, chief portfolio strategist at TD Waterhouse, said "where there's smoke there's fire", adding the market is now looking for a higher bid from BHP or for other players to enter the fray, and possibly other merger and acquisition activity in the sector. Continued...