K+S investors see Potash Corp deal within reach despite rebuff
* Potash Corp wants control of K+S Canadian project
* Suitor wants to manage over-supplied market
* German company has rejected 41 euro share offer
By Andreas Kröner and Ludwig Burger
FRANKFURT, July 9 (Reuters) - Shareholders in takeover target K+S say a deal could be done because suitor Potash Corp's main aim is to get control over its German rival's ambitious Canadian project and scale it back.
K+S's "Legacy" mine in the prairies in western Canada would be the first built from scratch in the global potash industry in almost 40 years. It would add to an already oversupplied market where demand is suffering from weak emerging market currencies and low crop prices.
Potash Corp could more easily ration global supply by controlling K+S, but still commit to leaving its German operations largely intact. The potential threat to K+S's domestic operations were seen as one reason why German regulators might block a deal.
K+S last week rebuffed Potash Corp's 7.9 billion euro ($8.6 billion) proposed bid of 41 euros per share as too low and suggested the suitor was planning to shrink the company.
Potash is in demand as a mineral because it plays a vital role in plant growth and crop resistance to cold and drought. Representing a market of about $20 billion, it is one of three main nutrients used in synthetic fertilisers, alongside nitrogen and phosphorus. Continued...