bagged its long-pursued quarry -- finally convincing Terra Industries ( TRA) to sell itself for about $4.6 billion in cash and stock in a deal announced Friday -- CF would like nothing more than to focus on integrating the two companies, which will create one of the biggest fertilizer producers in the world. But in many ways the most interesting part of this particular corporate marriage -- more arranged than of true love -- is the inside-story of the drama that unfolded over the last 14 months, as CF Industries pursued its hostile takeover attempt of Terra while, at the same time, attempting to fend off its own aggressive and unwanted suitor, Agrium ( AGU). (Agrium, for its part, relinquished its hostile bid for CF on Thursday; its offer for the Deerfield, Ill., company was conditioned on CF giving up on Terra.) In an interview with TheStreet on Friday, Wilson was sticking close to his talking points. "Our focus today is on putting the two companies together and looking ahead," he said. Still, there was the seeming disconnect between CF's words in January, when the company announced it was giving up its effort to buy Terra, and the eagerness with which it boosted the value of its bid in coming back to the table three weeks later, after Yara Industries had swooped in and wooed Terra into its Norwegian fold. Back in January, before Yara entered the picture, Wilson said in a statement that it wasn't in "the best interests of CF Industries stockholders" to chase Terra by offering it a deal it couldn't refuse. So why was it in the best interests of CF shareholders now? What changed? "What changed is that we found out that Terra was, in fact, for sale," Wilson said. Other sources close to the situation have indicated that Terra made itself unavailable to any kind of negotiation at all during the year of CF's pursuit -- an allegation seemingly corroborated by Wilson Friday. But he didn't want to talk about it much. "Prior to
the Yara-Terra deal , we had no indication that Terra was for sale," he said. "We are very comfortable acquiring Terra at this valuation; we believe this is a value-creating merger for our stockholders."
Wilson said that acquisition will be "significantly accretive" to the company's bottom line on a cash-basis in the first year after the deal closes and on a GAAP-basis in the second year. That includes any dilution that will come from the issuance of $1 billion worth of new equity -- proceeds CF will use to pay down some of the nearly $4 billion in debt it has taken on to pay for Terra. The companies hope to close the deal in April, Wilson said. As for the $135 million in synergies CF mentioned in its press release, about half of that total will come from reduced selling, general and administrative expenses: in other words, shutting down Terra's Sioux City corporate headquarters. Other savings will come from cutting the overlap that exists in the two companies' transportation costs: both lease certain railroad assets, for example. As for layoffs, Wilson wouldn't completely rule them out. But, he said, "We see plant operations largely if not totally kept intact." Wilson and CF perhaps do deserve credit for sheer persistence. It seems likely that the Fertilizer Wars of 2009-2010 will become part of case-study lore at MBA programs and in corporate-law courses around the country. If there aren't champagne bottles popping in Deerfield tonight, we at TheStreet would be surprised. Wilson wouldn't comment on the fate of Terra's top managers, especially Terra chief Michael Bennett. "Those kinds of announcements will be made at the appropriate time," Wilson said. He also downplayed the potential for a clash of corporate cultures, or the notion that C-suite tensions may have developed between Deerfield and Sioux City. "CF and Terra are both companies with Midwestern roots," Wilson said. "We've known each other for a long time." (Indeed, CF and Terra executives first broached the idea of a combination in 2004.) "I believe there's a high degree of respect between the two companies. There certainly is between the two CEOs." -- Written by Scott Eden in New York