Thursday, in another step in the long drawn-out acquisition battle, agricultural nutrients maker Agrium Inc. (AGU, AGU.TO) sent a letter to stockholders of CF Industries Holdings Inc. (CF), seeking their response to Agrium's 'best' and 'final' offer to acquire CF Industries.
On November 5, Agrium once again sweetened its hostile offer to buy fertilizer maker CF Industries, its third offer revising the cash portion, this time offering $45 in cash plus one Agrium share per CF share. The offer has a total value of $92.99 per share based on its closing stock price on November 4, which marks an increase of $5.00, or 12.5%, in the cash consideration.
The company said that its new offer represents a 106% premium to CF's January 15, 2009, price of $47.23, and a premium of over 75% to CF's closing price of $55.58 on February 24, 2009, the day before Agrium announced its initial proposal.
As CF rebuffed its efforts and ignored shareholders' strong support for nearly nine months, Agrium said it was making the offer directly to CF shareholders.
The company also urged CF's shareholders to tender their shares so as to convey to the CF board that they want the deal at the current price.
Agrium said "This is CF stockholders' final opportunity to make it clear to the CF board that you want to receive a premium rather than pay one. We urge you to tender your shares by the offer's expiration at midnight on November 18, 2009, to send an unambiguous message that you want this deal with Agrium at this price."
Further, Agrium assured CF's stockholders that it would consider all options, including nominating a slate of directors to the CF board and litigation, if a resounding majority of stockholders tender to its offer and CF refuses to act.
Agrium also said that it has received anti-trust clearance from Canadian authorities and will clear the U.S. regulatory approval shortly.
CF's board, after reviewing Agrium's latest revised proposal with management and its legal and financial advisors, concluded that the offer continues to substantially undervalue the company and is not in the best interests of CF Industries and its stockholders.
Just as Agrium is interested in CF, the fertilizer producer has been approaching Terra with revised offers. Since January 2009, CF Industries has made six separate proposals to acquire Terra, each of which was unanimously rejected by Terra Board as not in the best interests of Terra shareholders. CF also launched a fight to unseat Terra's board and is seeking to replace three members of Terra's board.
On November 1, CF sweetened its bid again offering $32 in cash and 0.1034 of a CF share for each share of Terra. However, Terra unanimously brushed aside the offer indicating the proposal as inadequate, opportunistic and not in the best interests of Terra and its shareholders. Terra once again urged its shareholders to reject CF's merger proposal.
A combination of any two of these three companies would create one of the world's biggest nitrogen fertilizer producers.
Recently, Agrium reached an agreement with Terra Industries Inc. (TRA), under which Agrium will divest to Terra 50% of Agrium's ammonia and urea production complex in Carseland, Alberta. Agrium and Terra have also agreed to a five-year supply contract in which Terra will receive a minimum of 60,000 metric tonnes of urea per year.
A possible merger between CF Industries and rival Terra Industries has been in the news since January 2009, when CF Industries came up with a bid to acquire all of the outstanding shares of Terra for an estimated value of $2.1 billion.
Barely days after CF industries tabled its buyout bid for Terra, the company found itself in the crosshairs of bigger rival Agrium. CF had rebuffed Agrium's buyout offer earlier this month, terming it "grossly inadequate" and "an attempt to interfere with its own proposed business combination with Terra."
The same day, CF sweetened its bid for Terra by nearly 38%. However, Terra snubbed CF's takeover bid for the second time, stating that even the revised offer substantially undervalued Terra both absolutely and relative to CF.
In mid-March, less than a month after the board of CF Industries rejected its buyout offer, Agrium took its bid directly to CF shareholders. At that time, Agrium said that it has commenced an exchange offer to acquire all outstanding shares of CF Industries at an exchange ratio of 1.0 common share of Agrium common stock plus $31.70 in cash. The company also said that CF stockholders would also have the option of electing to receive for each CF share either 1.7866 common shares of Agrium, or $72 in cash, subject to proration.
Later in April, Agrium raised its offer to buy all of the common stock of CF for $35 in cash plus one Agrium common share for each CF common share.
A month later, Agrium sweetened its bid for CF where CF stockholders were offered $40 in cash, an increase of $5, or 14.3%, in the cash consideration, and one common share of Agrium for each CF share.
However, CF Industries urged its shareholders to reject Agrium's hostile offer to acquire the company. At the same time, the CF board reaffirmed its intention to pursue a business combination with the Sioux City, Iowa-based Terra Industries and sent a letter to Terra's board.
The company sweetened its deal to acquire Terra by offering to pay $30.50 for each Terra share, with an exchange ratio between 0.4129 and 0.4539 of a CF Industry share. However, that offer too was rejected by Terra a day later, marking the third time that the company has rejected CF Industries' offer.
Meanwhile, CF Industries has also launched a fight to unseat Terra's board after its takeover attempts were repeatedly rejected by that company. The company is seeking to replace three members of Terra's board.
So far, since January 2009, CF Industries has made six separate proposals to acquire Terra, each of which was unanimously rejected by Terra Board as not in the best interests of its shareholders.
AGU closed Thursday's regular trading at $52.84, up $0.37 or 0.71%, on a volume of 2.98 million shares. However, the stock lost $0.44 or 0.83%, and traded at $52.40 in after hours. AGU.TO closed Thursday's regular trading at C55.76, up C$0.79 or 1.44, on the Toronto Stock Exchange.
TRA closed Thursday's regular trading at $35.20, down $1.49 or 4.06%, on the NYSE. The stock lost $0.09 in after hours trading.
CF closed Thursday's regular trading at $80.93, up $1.31 or 1.65%, on the NYSE. The stock gained $0.07 in after hours.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.