(Adds information from Terra proxy filing, updates premarket
quotes.)
DOW JONES NEWSWIRES
CF Industries Holdings Inc. (CF) sweetened its all-stock bid for
Terra Industries Inc. (TRA) to $3.07 billion, while recommending
shareholders reject Agrium Inc.'s (AGU) approach as the three
fertilizer companies look to remake the industry by their own
preference.
CF initially offered to buy Terra in January in a deal initially
valued at $2.1 billion. That valued Terra shares at $20, but was
revised from a fixed ratio to a range that could have been both
higher and lower than the initial bid. That range was unrevised in
Monday's latest bid, but the per-share value to be seen by Terra
holders was raised 11% to $30.50.
In a letter to Terra's board, CF Chairman and Chief Executive
Stephen R. Wilson wrote that the two companies merging is the best
course. He also expressed confidence that Terra shareholders will
back CF's board nominees at Terra's upcoming annual meeting. CF's
bid turned hostile earlier this month as the company decided to
take it directly to Terra shareholders.
Earlier Monday, Terra asked its shareholders to reject CF's
board nominees for the board, saying CF's previous proposal to
acquire the company runs counter to Terra's strategic objectives
and would deliver less value to Terra's stockholders compared with
Terra as a stand-alone basis. A Terra representative wasn't
immediately available to comment on the raised offer.
At the same time, CF again rejected Agrium's effort to acquire
CF, a deal initially valued at $3.6 billion which was made after
CF's approach to Terra became public. Agrium has launched its own
tender offer for CF, which is valued at $72 a share under the
bid.
The jockeying for position in the industry comes as fertilizer
producers look to take advantage of the drop in sector stock prices
since last summer to buy up production capacity ahead of what they
see as an inevitable turnaround in commodity prices.
Terra shares gained 6.8% in premarket trading Monday to $28.40
while CF added 0.9% to $68.30 and Agrium gained 4% to $37.70.
-By Tess Stynes, Dow Jones Newswires; 201-938-2473;
tess.stynes@dowjones.com
(Ingrid Pedrick Lehrfeld contributed to the story.)