UPDATE 1-CF Industries looking at financing options, shares jump

Wed Dec 4, 2013 4:10pm EST
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(Adds company, analyst comment)

By Chuck Mikolajczak and Rod Nickel

Dec 4 (Reuters) - U.S. fertilizer company CF Industries Holdings Inc said on Wednesday it hired two investment banks to evaluate funding options, including a master limited partnership, pushing shares up 10 percent.

The nitrogen producer first disclosed in a regulatory filing that it was examining a master limited partnership (MLP) and "MLP-like structures" as well as other financing options.

CF has asked the two banks to help the company understand how MLPs work and whether there are opportunities within CF to use such a structure, said CF Chief Financial Officer Dennis Kelleher at the Citi Basic Materials conference in New York.

"I stress these are studies and there has been no conclusion," Kelleher told investors, adding that the process will stretch into 2014.

The company did not disclose the names of the two investment banks.

A master limited partnership is a dividend-paying investment vehicle that enjoys special tax breaks and is often used by natural resources companies.

The look at funding options comes after hedge fund Third Point LLC disclosed a large stake in CF in July and pressed for a bigger dividend. Tony Will, senior vice-president of manufacturing and distribution at the Deerfield, Illinois-based company, will take the helm on January 1.   Continued...