Potash Corp appeals to Israel to allow deal for rival

Wed Oct 31, 2012 1:49pm EDT
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By Steven Scheer

JERUSALEM (Reuters) - Potash Corp, the world's No. 1 fertilizer maker, is ramping up efforts to buy Israel Chemicals Ltd, appealing directly to Israel's prime minister to back a deal that would rank as the largest foreign takeover of an Israeli company.

Conglomerate Israel Corp, which owns a majority in ICL, said that Potash Chief Executive Bill Doyle has met Israeli Prime Minister Benjamin Netanyahu to push for a deal, while financial daily Calcalist said Netanyahu has instructed his staff and the finance ministry to examine it.

Potash Corp confirmed on Wednesday it has met with Israeli government officials, and Israel Corp said it was aware of the meetings.

"The company confirms it is aware that Canada's Potash is in talks with various government agencies that included a meeting with the prime minister regarding examining the possibility of merging ICL with Potash," Israel Corp said in a statement.

Israel Corp officials declined to comment further. The finance ministry said it had not received any formal request.

Potash Corp already has a 13.84 percent stake in ICL, the world's sixth-largest fertilizer producer. It made its initial investment in 1998.

In the past, Israeli regulators have rebuffed Potash's attempts to take over ICL. Similarly, in 2010, the Canadian government blocked Anglo-Australian miner BHP Billiton Ltd from scooping up Potash Corp, saying the deal would not benefit the country.

"We believe it is likely that the Israeli government will come to the same conclusion regarding a takeover of ICL," said Sophie Jourdier, an analyst at Liberum Capital, in a note.   Continued...

Potash Corp's head office in Saskatoon is pictured on November 3, 2010. REUTERS/David Stobbe