CF Industries Holdings Inc. successfully completed its exchange offer for Terra Industries Inc. common stock on April 15, 2010, thereby completing its acquisition of Terra. As a result, Terra is now a wholly-owned subsidiary of CF. As of the expiration of the subsequent offering period, Terra stockholders had tendered a total of 92,230,296 shares, representing approximately 92.1 percent of Terra’s outstanding common stock. The subsequent offering period expired at 5:00 p.m., New York City time, on April 14, 2010. All shares that were validly tendered in the exchange offer have been accepted for payment.
As CF now owns more than 90 percent of the outstanding shares of Terra common stock, it completed the acquisition of Terra through the short-form merger procedure under Maryland law, without a vote or meeting of Terra’s stockholders. In the merger, each outstanding share of Terra common stock not tendered and purchased in the exchange offer will be converted into the right to receive $37.15 in cash and 0.0953 of a share of CF common stock, less any required withholding taxes and without interest, which is the same amount per share that was offered and paid in the exchange offer. As of April 15, Terra common stock ceased trading on the New York Stock Exchange.
In addition to Terra, CF will now own the approximately three-fourths of Terra Nitrogen Co. LP (TNCLP) that was formerly owned by Terra Industries. TNCLP’s major assets include the large ammonia (1,050,000 st/y) and UAN (1,925,000 st/y) plant at Verdigris, Okla., and terminals in Blair, Neb. and Pekin, Ill.
CF announced that it has successfully priced a public offering of 11,235,956 shares of its common stock at a price of $89.00 per share. CF has also granted the underwriters a 30-day option to purchase up to an additional 1,685,394 shares of common stock on the same terms and conditions to cover over-allotments. The common stock offering is expected to close on April 21, 2010.
CF’s subsidiary, CF Industries Inc., is commencing a public offering of senior notes in an aggregate principal amount of $1.6 billion. CF intends to use the net proceeds from the offering of senior notes to repay outstanding borrowings under its $1.75 billion senior secured bridge facility, and to the extent of any net proceeds in excess of the amount required to fully repay borrowings under the senior secured bridge facility, to repay outstanding borrowings under its $2.0 billion senior secured term loan facility. The senior secured bridge facility and senior secured term loan facility were used to fund cash requirements relating to CF’s acquisition of Terra.