CF Industries Holdings Inc. said Feb. 18 that it has filed notification with the U.S. Department of Justice and the Federal Trade Commission as required under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, relating to its proposed acquisition of Terra Industries Inc. (NYSE: TRA).
“We are committed to a combination of CF Industries and Terra and are confident that the transaction will be approved in all relevant jurisdictions,” said Stephen R. Wilson, chairman, president, and chief executive officer of CF Industries. “We continue to believe a combination is in the best interests of both CF Industries and Terra shareholders.”
In addition, CF posted a report from the Federal Trade Commission dated Sept. 2, 2008, in response to a Congressional inquiry into pricing in the fertilizer industry in North America, to www.transactioninfo.com/cfindustries. The report stated, among other findings, that “markets for fertilizer products in different countries are highly integrated, indicating that fertilizer prices are based on world market conditions.” FTC also “found no indication that changes in concentration in North America had any significant effect on domestic or foreign fertilizer prices.”
On Jan. 15 CF proposed to acquire all of the outstanding common shares of Terra Industries Inc. for 0.4235 shares of CF per common share of Terra Industries in a deal valued at $2.1 billion (GM Jan. 19, p. 1). CF shareholders would own 53 percent of the new company and Terra’s 47 percent. At the time of the announcement, the proposal represented a premium of 34 percent based on the 30-day volume weighted average prices for the shares of the two companies, and a 29 percent premium based on the 10-day volume weighted average. CF noted that since the announcement, Terra’s stock price has increased by over 40 percent.