CF phosphate purchase not deterring Mosaic stock buying plan

29 October 2013 22:00  [Source: ICIS news]

HOUSTON (ICIS)--The acquisition of the CF Industries (CF) phosphate business will not have any bearing on Mosaic’s plan to begin buying back stock, the fertilizer producer said on Tuesday.

While not confirming the level of shares it would seek to reacquire, Mosaic officials said the buyback programme could commence after 26 November without any restriction as that is the date when transfers of the shares presently owned by the Cargill Trust can be moved.

The Cargill Trust presently owns approximately 129m Class A common shares, and earlier this year, Mosaic officials expressed confidence that the trustees of the former parent company would be willing to part with their holdings in the fertilizer producer.

It is anticipated that Mosaic could be looking at up to $4bn (€3bn) in share repurchases by mid-2014. Company officials have previously said it intended to take a proactive approach to buying back stock regardless of the decision of the Cargill trustees.

Beyond looking at gaining back its shares, the purchase of the CF assets will bring a boost to stockholders as a spokesperson for Mosaic confirmed that the purchase is anticipated to add approximately 30 cents/share to future earnings.

On Monday, the fertilizer producer announced it had agreed to acquire the phosphate business of CF for $1.2bn in cash plus $200m to fund CF’s asset retirement obligation escrow. The deal included the Hardee County, Florida phosphate mine and plant as well as an ammonia terminal and product warehouse in Tampa.

($1 = €0.72)


By: Mark Milam



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