(Updated for Terra Industries stock-price movement and to include details on Terra Industries' special dividend, distributed Friday.)
SIOUX CITY, Iowa (
) -- The song remains the same.
once again spurned the advances of rival
, which had increased its buyout price last week for the sixth time since beginning its takeover pursuit back in January.
CF, which has its own hostile suitor in Canada's
to worry about, had raised the cash portion of its offer to $36.75 a share from $32. The stock portion remained the same at 0.1034 CF shares. The total offer values Terra at nearly $4.6 billion, or $46.05 a share, based on CF's closing stock price Friday.
CF's original bid in January was worth only about $2.1 billion, but since then the equities markets have surged, especially stock prices in cyclical industries such as fertilizer. Year-to-date, Terra's shares have raced higher by nearly 160%.
That rally -- plus the apparently
behind the rally -- constitutes Terra's basic argument against a deal. "The Board considered, among other factors, that the fertilizer sector has strengthened significantly in recent months," Terra said in a press release. "The Board believes the market consensus is shifting to reflect the brighter near- and long-term prospects for the entire sector, and that the latest improvement to CF's bid does not fully reflect these brighter prospects."
On Friday, Terra distributed its planned special dividend -- $7.50 a share -- a defensive tactic designed to thwart CF's overtures.
Investors had bid up Terra shares 12% since
, but the stock retreated Monday. Accounting for the special dividend, Terra shares were slipping 2.3% to $34.47 in midday trading.
CF shares, meanwhile, were trading at $89.24, down 0.9%.
In late November, CF succeeded in
after a proxy battle, though it still doesn't have a majority and, thus, can't force home a deal.
in its effort to subsume CF Industries; earlier this month, Agrium said it would nominate two dissident candidates up for election to CF's board at an annual meeting next year.
-- Written by Scott Eden in New York
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