April 10, 2013 / 1:37 PM / 4 years ago

UPDATE 1-Israel finance minister opposes Israel Chem sale to Potash Corp

* Lapid: to wage belligerent policy to preserve country's resources

* To set up panel to re-examine state's rights to natural resources

* ICL shares fall 4.3 pct, Israel Corp down 7 pct (Adds details, background, share reaction)

By Tova Cohen

TEL AVIV, April 10 (Reuters) - Israel's new finance minister Yair Lapid came out against the sale of fertiliser maker Israel Chemicals to Canada's Potash Corp, sending shares in ICL and its parent company lower.

Lapid, a former TV anchor whose upstart centrist party was the biggest surprise in Israel's January election, was named finance minister last month.

"Lapid advised his ministry's senior officials he intends to wage a belligerent policy to preserve the natural treasures of the State of Israel," Lapid's spokeswoman said in a statement.

The spokeswoman quoted Lapid as saying: "The state of Israel's natural resources are a public asset and the Israeli public should benefit from them."

Potash Corp, the world's No. 1 fertiliser producer, is seeking to raise its stake in ICL from 14 percent but Israel's government has a golden share in ICL, giving it a veto right.

ICL, the world's sixth-largest potash maker and the second-largest company by market value on the Tel Aviv exchange, is controlled by conglomerate Israel Corp. ICL has a market value of 61.4 billion shekels ($16.9 billion).

Israel Corp Chief Executive Nir Gilad told reporters earlier on Wednesday that since the election there were no talks between Potash and the government.

Israeli media reported that Israel Corp Chairman Amir Elstein had met Canadian Foreign Minister John Baird this week but Gilad declined comment. Baird also met Lapid on Tuesday but Lapid's spokeswoman said they did not discuss Potash's bid.

In February Potash said it was determined to buy most, if not all, of ICL and that stiff local opposition to such a takeover was based on unfounded fears.

Analysts have said the sale of ICL is a key issue for Israel's markets. Although Lapid faces populist pressure against the sale, such a deal could be a huge tax windfall at a time when the government faces a large budget deficit.

ICL shares were down 4.3 percent to 45.80 shekels in late Tel Aviv trade, while Israel Corp shares were off 7 percent.

Lapid has decided to set up a public committee to re-examine the state's rights to natural resources managed by private companies, the statement said.

ICL's new CEO Stefan Borgas defended ICL in the wake of a campaign by some politicians to increase the amount ICL and other resource companies pay the government.

ICL pays over 1 billion shekels a year in taxes and royalties, or 35 percent of its domestic profits, and will in future pay even more due to changes in tax policies, Borgas told a ceremony marking 20 years of trade in ICL shares.

"We expect the government take to reach 45 percent, which is the highest government take paid by any fertiliser or chemical company in the world," he said.

$1 = 3.63 shekels Editing by Steven Scheer and David Holmes

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