CF Won’t Extend Financing For Terra Deal

A day after rival fertilizer maker Terra Industries again rebuffed its takeover bid, CF Industries said it will not seek to extend financing to complete an acquisition of the Sioux City-based company beyond the end of this year.

CF’s $2.5 billion financing arrangement with Morgan Stanley is set to expire on Dec. 31. The company said its ability to obtain financing for any Terra transaction after that date will depend on the credit markets and other factors.

In a statement late Tuesday afternoon, CF said it has not given up on combining the two companies, but warned investors there is "no assurance” that CF will take further action to acquire Terra after Dec. 31.

"We continue to believe that an acquisition of Terra is in the best interests of the stockholders of both companies and intend to consider alternatives available to us to advance this transaction," CF President, CEO and chairman Steve Wilson said in a statement.

CF, which launched its hostile bid for Terra in January, did not disclose what specific alternatives it might pursue.

On Tuesday, CF also disclosed it also has sold a "sufficient number” of Terra shares in open market transactions, bringing its interest in Terra from 7 percent to just below 5 percent. As a result, the company said it no will longer be required to file a Schedule 13D in regards to Terra with the U.S. Securities and Exchange Commission. The move means CF is now free to have private conversations with Terra without having to immediately publicly disclose such discussions.

In early, after-hour trading Tuesday, Terra shares were down more than 3 percent on some speculation that the likelihood of a CF-Terra deal could be fading, while CF shares were unchanged.

On Monday, Terra announced its board had turned down CF’s sweetened offer of $29.25 per share in cash, plus 0.1034 share of CF common stock, raising the value to nearly $4.6 billion. All 11 directors rejected the bid, including three CF-backed nominees elected at Terra’s annual meeting last month.

In a statement, Terra said the latest offer, while higher than seven previous bids, continues to "substantially" undervalue the Sioux City-based company.

The company said the offer did not fully reflect improving conditions in the fertilizer market. A broad recovery among its agricultural and industrial customers is expected to drive rising demand and improving margins for the company’s upgraded nitrogen-based products.

"This thing has been going on for almost a year," Louis Meyer, a New York-based analyst at Oscar Gruss & Son Inc., told Bloomberg News in an interview Monday. "Terra clearly wants to stay independent.”

As it has pursued Terra, CF has faced its own takeover threat from Alberta, Canada-based Agrium.

(Source: Sioux City Journal)

Leave a Reply

Latest News
Young Corn Plants
ManagementTimac Agro USA Acquires Michigan Ag Retailer
January 20, 2017
Timac Agro USA, an agriculture supply company specializing in high-efficiency plant and animal nutrition products, has acquired St. Louis,MI-based A&E Ag, Read More
Soybean field
Crop InputsNufarm Teams Up With John Deere Financial
January 19, 2017
Nufarm and John Deere Financial have teamed up to help farmers grow a better tomorrow. This program helps make purchases Read More
Sonny Perdue
LegislationTrump Formally Picks Perdue As Agriculture Secretary
January 19, 2017
U.S. President-elect Donald Trump officially announced Sonny Perdue as his choice for secretary of agriculture on Thursday, selecting a former Read More
ManagementPresident Trump, Wisconsin Review, and a Dow-DuPont Upd…
January 18, 2017
Editors Paul Schrimpf and Eric Sfiligoj reflect on a new administration, a recent winter show, and crop protection company mergers. Read More
Industry NewsBayer, MS Technologies Get China Approval For Balance G…
January 18, 2017
MS Technologies and Bayer have received import approval from China for Balance GT soybeans. The new Balance GT Soybean Performance Read More
Werner Baumann, Bayer AG, and Hugh Grant, Monsanto
Industry NewsReport: Monsanto, Bayer CEOs Among Latest to Make Trump…
January 18, 2017
The chief executive officers of German chemical giant Bayer AG and U.S. seed behemoth Monsanto, Werner Baumann and Hugh Grant, Read More
Giant Ragweed
HerbicidesStudy: Focusing On Weed Seedbank Can Help Manage Herbic…
January 18, 2017
Researchers writing in the latest issue of the journal Weed Science provide important insights on the control of herbicide-resistant giant Read More
Management3 Financial Trends To Watch In Agriculture
January 17, 2017
I recently had the opportunity to attend a meeting of credit managers for Midwest ag supply and input companies, in part Read More
Andersons Retail Store
CropLife 100The Andersons To Close All Retail Stores; Shutdown Does…
January 16, 2017
In a stunning announcement to the Toledo area, The Andersons Inc. said on Sunday that it would close its two Read More
Trimble TMX-2050 In-Cab Display
Eric SfiligojPrecision To Lead Agriculture In 2017?
January 16, 2017
Another new year is upon us! And I’m certain I speak for many in the agricultural world when I say Read More
Corn
Eric SfiligojThe Mood From Madison? In A Holding Pattern
January 16, 2017
Last week, I had the chance to attend the annual Wisconsin AgriBusiness Classic show in Madison, WI. It’s been a Read More
Syngenta Sign
Crop InputsAccenture Helps Syngenta Transform Its Global Logistics
January 13, 2017
Syngenta, a leading agriculture company, has collaborated with Accenture to design and implement a new digital logistics operating model across Read More
Fall Creek Seth Harden The Nature Conservancy
StewardshipLocal Farmers’ Watershed Initiative: Continuous Improve…
January 13, 2017
The goal in the Big Pine Watershed Project is to more intentionally do what local farmers and responsible ag retailers Read More
HerbicidesEPA Expands Enlist Duo Herbicide Registration To 34 Sta…
January 13, 2017
The U.S. EPA has expanded the geography for application of Enlist Duo herbicide from 15 to 34 states. This means Read More
Olson Ag Enterprise
CropLife 100Wilbur-Ellis Acquires Nebraska Seed Retailer
January 13, 2017
Wilbur-Ellis’ Agribusiness, a recognized leader in precision agriculture technology and the distribution and marketing of plant protection, seed and nutritional Read More
ManagementDeere-Precision Planting Update and the Ag Secretary Wa…
January 12, 2017
Editors Paul Schrimpf and Eric Sfiligoj provide the latest on the court date for John Deere/Precision Planting and the quest Read More
Monsanto sign
Seed/BiotechMonsanto, NRGene Form Agreement For Big Data Genomic An…
January 12, 2017
Monsanto Co. and NRGene have announced that the companies have reached a non-exclusive, multi-year global licensing agreement on NRGene’s genome-analysis Read More
AGCO Custom applicator
SprayersAGCO, Asmark Institute To Offer Training For Beginning …
January 11, 2017
AGCO Corp. and the Asmark Institute are collaborating to offer a new training program dedicated to educating and developing custom Read More