Share this article
Diesel loader

Canadian mining company Potash Corporation of Saskatchewan (PotashCorp) has confirmed its bid to acquire K+S Aktiengesellschaft in a deal worth an estimated $8bn.

PotashCorp said in a statement: "There is no certainty that any offer will ultimately be made or as to the terms on which such an offer might be made.

"PotashCorp does not intend to make any additional comments on this matter at this time unless and until it is appropriate to do so, or a formal agreement has been reached."

K+S said PotashCorp informed its board that the company may decide, depending on certain conditions, including a due diligence exercise to acquire it.

A source with knowledge of the matter told The Wall Street Journal that K+S may reject the offer, citing the value as too low.

K+S said the company is evaluating the available options at present.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
"There is no certainty that any offer will ultimately be made or as to the terms on which such an offer might be made."

Scotiabank said that in 2015 Potash Corp is expected to mine around 9.2 million metric tonnes (Mmt) of potash.

Following the merger, the combined company is expected to have almost 27% of global potash capacity by 2017.

K+S is in the process of developing a $2.64bn mine in the western Canadian province of Saskatchewan, which is expected to produce about 2.9Mmt of potash a year by the year 2023.

According to sources cited by Reuters, K+S is worried that PotashCorp is trying to shift capacity out of an oversupplied market to improve its profitability.

The sources also added that if the deal is finalised, PotashCorp could keep the German company’s mines in the country operations and would not sell the K+S’s salt business.

Image: 17t diesel loader in K+S potash mine. Photo: courtesy of K+S Aktiengesellschaft.