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The world’s biggest fertilizer company Potash Corporation in Canada is asking its shareholders to reject a £25 billion bid from mining giant BHP Billiton – potentially the biggest takeover in the world this year.
The board of directors was unanimous in its belief that the offer “substantially undervalues PotashCorp and fails to reflect both the value of our premier position in a strategically vital industry and our unparalleled future growth prospects," according to PotashCorp president and chief executive officer Bill Doyle.
"The Board thoroughly reviewed the formal offer documents in connection with BHP Billiton's unsolicited offer and concluded that the offer is wholly inadequate and is not in the best interests of the company, its shareholders or other stakeholders. We strongly urge shareholders to reject BHP Billiton's opportunistic offer and not tender their shares."
London-based BHP, which employs 41,000 people and has operations in 25 countries, last week launched a hostile bid for Potash after directors of the company refused to back its offer.
BHP is a market leader in the production of coal, copper and iron ore and is thought to be betting that demand for agricultural fertiliser ingredients will rise as the developing world requires more meat and plants.
Potash Corp is reported to be in discussions with possible counter-bidders and the group said it was working on a range of strategic alternatives which might boost shareholder value.