Agrium increases takeover offer for CF Industries

Agrium Inc., North America's third- largest fertilizer producer, increased its takeover offer for CF Industries Holdings Inc., four days after CF challenged Agrium to pay more.

The offer was boosted to $75.30 a share in cash, Calgary- based Agrium said today in a regulatory filing. Agrium previously bid about $72 a share.

Agrium's new proposal comes after CF Chief Financial Officer Anthony Nocchiero said on a March 23 conference call that Agrium could afford to pay more than $100 a share. CF has said it remains committed to its own takeover of Terra Industries Inc.

"That was the proverbial shot-across-the bow," Joseph Gomes, a senior analyst at Oppenheimer & Co. in New York, said in a March 25 interview. "Agrium's choice is either come up with more money, or walk away."

Agrium, which also is the largest retailer of seeds, pesticides and fertilizer to U.S. farmers, is seeking to boost its investments in production and distribution of crop nutrients. The company first made its bid public on Feb. 25, more than a month after Deerfield-based CF announced its intention to acquire Sioux City, Iowa-based Terra.

Agrium's most recent offer includes options for CF investors to receive 1.8685 Agrium shares for each CF share they hold. That tops Agrium's earlier bid of 1.7866 of its shares for each of CF.

CF shareholders also could choose to be paid $35 a share in cash and one Agrium share, up from the earlier offer of $31.70 in cash and one Agrium share.

Potash Corp. of Saskatchewan Inc. and Mosaic Co. are North America's largest fertilizer producers by market value.

Agrium rose 95 cents, or 2 percent, to C$48.98 yesterday in Toronto Stock Exchange trading. CF gained 78 cents, or 1.1 percent, to $74 on the New York Stock Exchange, for a market value of about $3.58 billion.