K+S once again rejected PotashCorp’s offer

K+S AG once again rejected PotashCorp’s takeover offer on 7th Aug. The price of 41 euros (C$59) per share is too low, and PotashCorp’ s commitments on maintaining jobs and keeping mining sites open in Germany are not enforceable, K+S said.

 

PotashCorp, No. 2 potash miner of the world, wants to acquire No. 5 producer K+S as global competition ramps up among sellers. K+S has suggested PotashCorp plans to shrink the company. 

 

PotashCorp has been pushing to talk with K+S management despite the German company’s initial rejection last month of the Canadian company’s 7.9 billion-euro (C$11.3 billion) bid. Shares of PotashCorp eased in New York and Toronto, while K+S stock climbed 1.4 percent in Frankfurt.

 

Analysts have speculated PotashCorp wants to acquire K+S, a higher-cost producer, to shut some production to support prices. People familiar with the situation said that PotashCorp offered K+S a guarantee it would keep German mines operating for five years.

 

If it acquires K+S, PotashCorp would finish building the German company’s Saskatchewan mine and sell its potash offshore through Canpotex, PotashCorp CEO Jochen Tilk said on July 30.