Agrium Makes Hostile Bid for CF Industries

Agrium offers $72 a share in a cash-and-stock deal valued at $3.6 billion
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Agrium

(AGU)

announced a hostile bid on Wednesday to acquire

CF Holdings

(CF) - Get Report

for $72 a share.

The cash and stock deal would be valued at $3.6 billion based on CF's closing price yesterday of $55.58 a share. CF holders would get one Agrium common share and $31.70 in cash for each of their shares.

Shares of CF were up $8.38, or 15% to $63.96. Agrium shares were trading down $1.98 or 4.9% Wednesday to $38.32.

The offer in the hot fertilizer space comes about a month after CF Industries offered $2.1 billion in its own hostile bid for

Terra Industries

(TRA)

. But Calgary, Alberta-based Agrium said its offer is contingent on CF dropping its bid for Terra, whose shares were down 22 cents to $24.60 on Wednesday.

"The proposed transaction is strategically compelling and a superb opportunity to create value for both Agrium and CF shareholders," said Agrium President and CEO Mike Wilson. "Adding CF's strong North American nitrogen, phosphate and extensive crop nutrient distribution assets to Agrium's broader global wholesale and retail capabilities would greatly enhance our existing portfolio and enable us to create a premier global franchise across the entire agricultural value chain," he said.

Agrium said the proposal is not contingent on finding financing: "Agrium has sufficient cash resources and committed financing underwritten by Royal Bank of Canada and The Bank of Nova Scotia to fund the cash portion of the proposal," the company said in a statement.

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