Thu, Aug. 13, 9:59 AM
- Potash Corp. (POT -1%) opens lower after K+S (OTCQX:KPLUY) affirms its rejection of the €7.9B ($8.8B) takeover proposal by the Canadian company while leaving the door open to an improved bid.
- POT's proposal of €41/share does not even remotely reflect K+S's underlying value, CFO Burkhard Lohr says, also questioning reassurances POT has given on jobs and sites.
- Still, the CFO makes it clear that K+S does not oppose a takeover in principle and would study an improved offer, saying "Don't get me wrong. We are not at all blocking a potential transaction."
- The K+S position seems strengthened by stronger than expected quarterly earnings, as Q2 operating profit rose 14% Y/Y to €179.2M, beating a €168M consensus forecast, citing higher prices for thawing salt in North America, cost cuts and the stronger dollar.
Wed, Aug. 12, 12:58 PM
- The majority of K+S (OTCQX:KPLUY) retail shareholders appears to oppose Potash Corp.'s (POT -0.8%) takeover offer, but Scotiabank analyst Ben Isaacson thinks institutional investors may have a different opinion.
- Isaacson does not see why any institutional K+S shareholder would not jump at the opportunity to cash in at €41/share, and believes they would favor a takeover "based on feedback from K+S institutional holders."
- Given concessions and guarantees POT has made, Isaacson thinks any rejection of the proposal would be based on an emotional attachment to the company, “certainly not due to K+S being undervalued."
Mon, Aug. 10, 8:39 AM
- K+S (OTCQX:KPLUY) says a majority of its private shareholders support management's rejection of the takeover proposal by Potash Corp. (NYSE:POT).
- K+S says it conducted a survey last month among its private shareholders, who together hold ~30% of the company; 28% of those shareholders responded with 84% supporting the rejection, 4% saying they would sell their shares at POT's proposed €41/share ($44.95) price, and 28% approving a significantly higher offer.
- The news would appear to further diminish POT's chances of taking over its rival, after K+S said Friday it had rebuffed another unsolicited takeover approach from the company.
Fri, Aug. 7, 8:43 AM
- Potash Corp. (NYSE:POT) is sticking to its earlier bid of €7.85B ($8.6B) for K+S (OTCQX:KPLUY), the Germany salt and fertilizer says after receiving an unsolicited letter from its Canadian rival that seeks to take over the company.
- K+S had previously rejected the €41/share takeover approach, saying the proposal undervalued its products and projects and could compromise jobs and strategy; POT management, on the other hand, thinks K+S’s suggestion that it’s worth €50/share is unwarranted.
Tue, Aug. 4, 4:49 PM
- Canpotex, the potash export sales arm for Potash Corp. (NYSE:POT), Mosaic (NYSE:MOS) and Agrium (NYSE:AGU), says it has hired Ken Seitz, chief commercial officer of uranium producer Cameco (NYSE:CCJ), as its new CEO.
- The current president and CEO, Steve Dechka, is retiring at the end of the year after 32 years of service with the company.
Thu, Jul. 30, 8:46 AM
- Potash Corp. (NYSE:POT) +0.9% premarket after slightly missing Q2 earnings expectations and reporting in-line revenues.
- POT lowered the top end of its full-year EPS forecast to $1.95 from $2.05 while keeping the low end of guidance unchanged at $1.75, vs. the analyst consensus estimate of $1.89, but the company issues an upbeat outlook, saying “While we have faced some near-term market headwinds, we are encouraged by the strength of global potash demand, especially in offshore markets."
- POT says Q2 potash production remained flat at 2.5M metric tons, while the average realized potash price rose 4% Y/Y to $273/metric ton; potash gross margin jumped 5.6% to $417M, but costs increased as the company sourced less potash from its lower-cost mines.
- The biggest Q2 weakness was the nitrogen business, where production fell 2% Y/Y and POT’s realized selling price was $334/metric ton, down from $393 in the year-ago quarter; the company says results were hurt rising supply in key producing regions.
- POT sees another solid year for potash demand, with total global shipments reaching 60M metric tons in 2015, would be just below 2014's record of 61M.
- POT says little about its proposal to acquire K+S, only reiterating that it wants to have “constructive” discussions with K+S management.
Thu, Jul. 30, 6:06 AM
Wed, Jul. 29, 10:21 AM
- Potash Corp. (POT -1.3%) is downgraded to Market Perform from Outperform with a $30 price target, cut from $36, at Raymond James, which cites deteriorating fundamentals in the global potash market.
- The firm says weak crop prices and challenging macro conditions in Brazil, including a weak currency and high interest rates, will continue to hurt demand and limit the possibility of producer price hikes anytime soon; more supply is expected from Russia, while demand has been slow in North America as a result of a shorter application window this year.
- The firm issues its downgrade even as shares are at multi-year lows, but sees no near-term fundamental catalysts that likely would drive the company’s earnings power higher - “If anything, we see increasing risk to the Street’s current 2015-16 estimates."
Wed, Jul. 29, 8:25 AM
- Germany's K+S (OTCQX:KPLUY) has asked economy minister Sigmar Gabriel for help in resisting an unwanted takeover approach by Potash Corp. (NYSE:POT), and has discussed the option of German state bank KfW taking a stake in K+S, the Handelsblatt newspaper reports.
- KfW could take a blocking minority stake but Germany's economy ministry and finance ministry are doubtful they could come up with a "common good" justification for such an intervention, according to the report.
- K+S earlier this month rebuffed POT's proposed bid of €41/share as too low.
Tue, Jul. 21, 1:11 PM
- Potash Corp. (POT +0.2%) has made a fresh attempt to win over the management of takeover target K+S (OTCQX:KPLUY) and the German regional state of Hesse, where it is headquartered, but failed to entice K+S into merger talks, Reuters report.
- POT CEO Jochen Tilk is said to have met with the state premier of Hesse, handing over documents about the company's plans to preserve jobs after a takeover that also were made available to K+S.
- K+S says the latest proposal contained nothing new and still sees no basis for talks.
Wed, Jul. 8, 12:31 PM
- Potash Corp. (POT -1.4%) does not plan to sweeten its bid for German rival K+S (OTCQX:KPLUY), sources tell Reuters, in contrast to media reports that it would consider such a move.
- The proposed bid of €41/share already represented an unusually high premium and should not be taken as a starting point for further increases, the sources say.
- POT was said to be confident of winning over shareholders with its current $8.7B bid, but that it would also be open to raising it slightly under certain conditions.
Tue, Jul. 7, 3:48 PM
- Potash Corp. (POT -2.2%) reportedly would be open to raising its $8.6B bid for K+S (OTCQX:KPLUY) if the German company could reveal more value not currently seen by the Canadian company.
- POT's €41/share bid represents a 43% premium to the average weighted price of K+S shares over the past six months, but K+S CEO Norbert Steiner has said the Legacy project alone is worth at least €21/share on top of €29 for the German company’s existing operations.
- The market may be factoring in a better than 50-50 probability that a deal happens, but J.P. Morgan Ben Scarlett sees only a one-in-three chance of success, believing a deal would face substantial execution risk and anti-trust or other concessions.
- The firm thinks European and North American anti-trust authorities will examine the impact of a deal in their own regions, and perhaps invoke conditions that require approval from authorities in places such as Brazil, China and India.
Thu, Jul. 2, 4:58 PM
- Potash Corp. (NYSE:POT) reportedly plans to analyze K+S’s (OTCQX:KPLUY) response and reasoning behind the rejection of the Canadian company's takeover offer before deciding on its next move, as it still sees strong logic as well as an opportunity to reach an agreement.
- K+S CEO Norbert Steiner sees the logic behind POT's bid as removing higher-cost production from an oversupplied market; indeed, POT has long preached the virtue of price stability and has questioned plans by rival producers to build new mines.
- By proposing a takeover, POT might be looking for a way to slow construction of K+S’s new Legacy mine, and a deal would hand it another aging and costly potash mine in Germany, Citi analyst P.J. Juvekar says.
Thu, Jul. 2, 8:18 AM
- K+S (OTCQX:KPLUY) plans to reject Potash Corp.'s (NYSE:POT) $8.6B-plus takeover offer because it considers the bid too low, Bloomberg reports.
- POT said last week that it made a “friendly” takeover bid, believed to be slightly more than €40/share.
- The German company is preparing to announce its opposition to the bid as early as today, according to the report.
Mon, Jun. 29, 8:58 AM
- Potash Corp. (NYSE:POT) does not plan any mine closures at K+S (OTCQX:KPLUY) if its bid for the German company is successful, according to multiple reports.
- K+S is said to be concerned that POT wants to take capacity out of an oversupplied market in order to boost profitability, but sources tells Reuters that POT intends to keep K+S's German mines operational, would not divest its market-leading salt business, and would continue with the development of a $4B legacy mining project in Canada.
- POT's exact bid amount for K+S has not been stated, but reports say it represents an almost 60% premium to K+S's 12-month trailing average stock price of 26 euros before the news of the takeover proposal, which equates to a price of 41.60 euros/share.
Fri, Jun. 26, 2:50 PM
- Potash Corp.'s (POT -2.1%) attempt to buy rival K+S (OTCQX:KPLUY) and create a company capable of controlling up to 30% of the global potash market is likely to face pushback from the German company and regulatory hurdles, analysts say.
- WSJ reports that K+S is likely to reject the confirmed offer from POT, believed to come in at slightly more than €40/share ($44.80) in cash, since it is seen as undervaluing the dominant position the two could achieve in North America, where POT has major mines and K+S is developing its own mine.
- Many analysts say the combined large market share in North America, and in other markets including Germany, means that German regulators likely would reject a takeover, particularly since Germany nixed a similar takeover attempt in 1997.
- K+S has sunk €2B ($2.2B) into a new Canadian potash mine which should start up in late 2016, which will add low-cost capacity of 2M metric tons/year for K+S - and which POT seems to be trying to scoop up on the cheap, writes WSJ Heard on the Street's Helen Thomas.
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