By Steve Gelsi
NEW YORK (Dow Jones) -- Agrium Inc. said Monday it would take
its $3.6 billion buyout offer directly to CF Industries
shareholders in the latest saga involving the two fertilizer
companies and a smaller rival, Terra Industries.
Agrium (AGU) said CF Industries Holdings Inc. (CF) shareholders
would receive $31.70 in cash and one common share of Agrium for
each CF share.
Under the deal, CF stockholders would also have the option of
receiving for each CF share either 1.7866 common shares of Agrium
or $72 in cash, subject to proration.
"CF's refusal to engage in discussions with Agrium left us with
no choice but to take our offer directly to CF stockholders," said
Agrium Chief Executive Mike Wilson.
CF Industries promptly rebuffed the latest approach from Agrium
after management initially rejected the deal on March 9.
CF noted that the cash and stock consideration is unchanged from
an initial proposal that was already turned down as "grossly
inadequate."
Agrium initially approached CF Industries on February 25 after
CF had made a hostile offer to buy Terra Industries (TRA) earlier
this year. Terra has now rejected two separate offers from CF,
which is now launching an appeal directly to Terra
shareholders.
The three-way merger contest pits Agrium's $5.7 billion market
cap against the $3.4 billion bulk of CF Industries. Terra
Industries weighs in at $2.7 billion.
Over the past two months, CF Industries' share price has climbed
to about $70 from $45 as one of the top performers of 2009 in the
S&P 500 .
On Monday, Agrium stock rose 2% to $36.85. CF Industries rose
1.7% to $69.81. Terra Industries rose 2.8% to $27.57.