POT's board of directors has rejected an
unsolicited takeover proposal from BHP for $39B, or $130 a share in
cash.
POT is trading higher by 29% in pre-market
today.
POT's Chairman Dallas Howe said that “The Potash
Corp. Board of Directors unanimously believes that the BHP Billiton
proposal substantially undervalues Potash Corp. and fails to reflect
both the value of our premier position in a strategically vital industry
and our unparalleled future growth prospects,”
Given
that POT trades at CAD$112.50, the offer is indeed ridiculous.
Obviously it is a n initial low ball number to start the conversation.
With
the expected increase in population as well as the quality of food that
the new middle classes of China and India and elsewhere will eat, the
fertilizer markets are going ot be a very hot area, hence the high level
of activity.
Global population will grow by one
third to 9.1 billion in 2050 from 6.8 billion, according to the United
Nations.
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