daveddawg

Agrium's Bold CF Bid: Nothing Short of Genius

This deal, while it may be good for AGU shareholders, will never happen. CF Mgmt is not interested and want TRA. As soon as the deal is pronounced dead, I expect AGU shares to pop, as the debt load they would have taken on would be extremely high, considering their current debt. The best AGU can do, is to continue to buy CF shares on the open market during dips, because the CF -TRA deal, IMO is not going to be that good for CF shareholders in the long run, because they won't be integrated in the N-P-K, esp K. If AGU really wants CF, then time is on their side. I suspect that AGU just didn't want CF to get TRA, because the valuable asset of CF is their cash and P, and AGU didn't want to buy the N plants of TRA . N plants are easy and cheap to build.

Will Terra Industries Reverse Its Position on CF Industries?

The author didn't even get the stock symbol correct. It is AGU, not AGR.
Why bother with little details like that? It makes me wonder about the rest of his "research".
Instead of The M & A Researcher, send me money! At least I know the symbol, and I didn't misspell a single word.

9 Reasons Why CF Should Reject Agrium and Acquire Terra Industries

I own both AGU and CF. You can imagine my surprise to wake up and find a merger proposal. The plums of CF are their P mines, and their cash. The plums of AGU are their retail distribution network, and their balanced N-P-K assets.
N plants are relatively cheap and easy to build. AGU has an advantage since Canada gas is so cheap, and shipping costs are way down. Since CF is only issuing paper, they must see that the value of the N plants is very time-related, or they would build their own with cash.
AGU knows the long-term value of the P mines will only go up, hence cash and stock.
If CF and TRA merge, they are still lacking K.
If AGU and CF merge, they have N-P-K plus retail/wholesale distribution networks. Forget TRA.
Who says CF can't be the acquirer of AGU?
I cynically think that AGU just threw up this offer so CF price would go up, and that CF could then complete TRA merger, and eliminate TRA as a competitor to both CF and AGU. The advisors to CF are sometimes thought of as being manipulators.
If AGU doesn't get CF, no harm/no foul, very little cost for a trial balloon, and TRA is merged. There is always next year.
If TRA doesn't merge, since they have no P or K, the only thing they can do is become the lowest cost producer of N, and flood the market with cheap N. Would you, as a farmer, want cheap N, and then have to find P and K, from someone who said-"you didn't buy MY N, but want P and K-only if you pay more,because you didn't buy N from me"? Ah, the convenience of 1 stop shopping.
This will get very interesting!