December 23, 2009 3:42 PM

Paul Weiss Wins Antitrust Approval in Hostile Fertilizer Bid

Posted by Matt Straquadine

There's been a development in the ongoing dance between the world’s three largest fertilizer companies: Agrium Inc. has won conditional approval of its proposed hostile merger with CF Industries Holdings, Inc. from U.S. competition regulators, according to Reuters. The Federal Trade Commission and Agrium have reached an agreement, which can be viewed here, that an Agrium-CF merger would be approved if Agrium sells two of its plants to third competitor Terra Industries.

For about a year now the three fertilizer giants have been circling one another. In January, CF announced an unsolicited $2.1 billion bid for Terra. In February, Agrium put forward its $3.6 billion hostile bid for CF. In November CF upped its Terra bid to $4.05 billion, mostly in cash--which Terra’s board again rejected.

Along with the recent approval, Agrium also has extended its offer deadline to late January, according to BusinessWeek. In a statement to shareholders, CF said that, "Agrium's offer is further away from being compelling than it ever has been."

So we're not sure on how this will shake out, but the three companies' lawyers are certainly staying busy. Calgary-based Agrium is being advised by Paul, Weiss, Rifkind, Wharton & Garrison, Deerfield, Illinois-based CF is being represented by Skadden, Arps, Slate, Meagher & Flom, and Sioux City, Iowa-based Terra has retained Cravath, Swaine & Moore. None of the lawyers were immediately available for comment.

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