05 November 2009 14:57 [Source: ICIS news]
HOUSTON (ICIS news)--US nitrogen fertilizer maker Terra Industries told its shareholders on Thursday that the latest takeover offer by rival CF Industries was inadequate and used shareholders’ own money.
“CF’s latest proposal is financially inadequate, even by applying valuation methodologies used by CF, and is only $2.00 per share more than the nominal value of its prior proposal,” Terra wrote in a letter to its investors.
In addition, Terra said, the cash component of CF’s latest proposal includes about $750m (€503m) of shareholder money that is the special cash dividend of $7.50 per share which Terra’s Board announced in September and will pay shareholders in December.
“Since January 2009, CF has made six separate proposals to acquire Terra, each of which was unanimously rejected as not in the best interests of shareholders,” Terra said.
CF’s latest proposal to acquire Terra offered $32.00/share in cash and 0.1034 of a share of CF common stock for each share of Terra common stock.
Meanwhile, Alberta-based Agrium on Thursday increased its takeover offer of CF to $45 in cash plus one share of Agrium for each share of CF, an increase of $5 in the cash portion of the offer.
Agrium’s takeover offer is contingent on CF dropping its bid for Terra.
CF noted that Agrium's offer represents substantially lower multiples of earnings before interest, taxes, depreciation and amortisation (EBITDA) than CF’s offer for Terra.
($1 = €0.67)
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