PRINTABLE VERSION   EMAIL TO A FRIEND   RSS FEEDS 19:11 UK, 26th Feb 2013, by Agrimoney.com
PotashCorp says it wants 100% of Israel Chemicals

Canadian fertilizer giant PotashCorp sought to calm fears among Israel Chemicals workers over its plans for it smaller rival as it revealed it was interested in taking a 100% stake, worth $16bn at current values.

Wayne Brownlee, the PotashCorp chief executive, clarified the group's position in a long-standing effort to increase its stake in Israel Chemicals, known as ICL, from 13.8%, saying it was intent on winning control.

"We're not interested in increasing the stake and still being a passive minority shareholder," Mr Brownlee told an investor conference.

"The minimum position would be to have a majority control position," he said, citing a desire for at least a 51% stake.

"On a longer-term basis, a 100% would be preferable if we can do that."

'Not hostile'

The group's latest efforts to raise its holding in ICL a campaign dating back to when PotashCorp bought its stake in 1998 have been hampered by January elections, which have sidelined talks with the Jerusalem government, which holds a golden share.

Benjamin Netanyahu, the Israeli prime minister, is still trying to piece a coalition government.

However, Mr Brownlee that PotashCorp's quest for control of ICL "is not, and would not be, a hostile attempt".

He said: "This would be negotiated that would have to be in the interest of all stakeholders," including ICL workers, who last week threatened to strike should a takeover be approved.

'Not about job cuts'

Mr Brownlee attempted to ease fears that a takeover would lead to mass redundancies, saying that the financial benefit of a deal would come from improved potash marketing.

"Clearly, the rationale for us to embark on that transaction if we can get there is more regard to marketing and being the lowest cost delivered supplier to anywhere in the world, which is a pretty powerful statement.

"It really isn't about production cuts, it's not about reduced employment. This really is a marketing story, it's a distribution logistics story, and we think that once we present those credentials we might be in a better position."

Share movements

The comments came after the close of Tel Aviv's stock market, where ICL shares closed down 2.5% at 47.32 shekels on Tuesday, giving the group a stockmarket value of $16.2bn.

Shares in PotashCorp, which two years ago was protected by Canada's government from a takeover by Anglo-Australian BNP Billiton  stood 0.3% higher at Can$39.79 in afternoon deals in Toronto.

Israel Chemicals itself announced a foreign acquisition on Monday, agreeing to acquire the phosphorus pentasulfide, or P2S5, business assets and operations of German-based Thermphos International.

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