Agrium, PotashCorp discussing potential merger

by Eric Schroeder
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Agrium PotashCorp
Companies say they are in very early stages of discussions.
 
SASKATOON, SASKATCHEWAN, CANADA — Agrium Inc. and Potash Corporation of Saskatchewan Inc. on Aug. 30 confirmed they are in preliminary discussions regarding a potential merger of equals.

“No decision has been made as to whether to proceed with such a combination, no agreement has been reached, and there can be no assurance that any transaction will result from these discussions,” the companies said.

Based in Calgary, Alberta, Canada, Agrium Inc. is a global producer and distributor of agricultural products, services and solutions. The company produces nitrogen, potash and phosphate fertilizers, with a combined wholesale nutrient capacity of over 9 million tonnes. The company supplies products and services directly to growers, including crop nutrients, crop protection, seed, as well as agronomic and application services. Agrium’s retail-distribution has a network of more than 1,400 facilities and over 3,800 crop consultants who provide advice and products to grower customers to help them increase their yields and returns on hundreds of different crops.

In an Aug. 4 conference call, Steve Douglas, chief financial officer of Agrium, said the company was on pace to have a record year in acquisitions.

“The total acquisitions this year are expected to total well over $500 million in annual sales,” Douglas said. “We are on a record pace this year in terms of retail tuck-ins, adding 33 sites in the U.S. and Canada with combined expected sales of over $230 million. In addition to these completed transactions, we have a couple other slightly larger deals that we have signed but not yet completed, including the recently announced Cargill acquisition. These other acquisitions are expected to add an additional estimated $300 million of sales and more than 30 locations. We expect this strong deal flow to continue, as we execute our strategy of growing in North America and retail business.”

Based in Saskatoon, Saskatchewan, PotashCorp is the world’s largest crop nutrient company, and is the largest producer, by capacity, of potash and one of the largest producers of nitrogen and phosphate. While agriculture is its primary market, the company also produces products for animal nutrition and industrial uses. 
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