Potash seeks richer bidder

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Potash seeks richer bidder

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Potash is looking for buyers willing to top BHP Billiton’s 30 billion euro hostile takeover offer.

Sources at the world’s largest fertiliser firm said they were confident alternative bids will emerge.

One name being mentioned is top Chinese fertiliser maker Sinofert.

It is tiny compared with BHP Billiton, but its parent, Sinochem Group, is a huge state-owned company.

So what chance that someone with deeper pockets than BHP will make a counter offer?

Analyst Julian Mayo, with Charlemagne Capital said: “Companies are feeling more confident. Companies are, in many cases, very cash rich. But at the same time from a demand perspective there is this huge insatiable appetite for commodities from China and I think in the next ten years from India.”

China – which itself has very few potash reserves – is the world’s biggest buyer and India is another major importer.

Potash Corporation’s board has flatly rejected BHP’s bid, and the Anglo-Australian mining giant said it would take the offer directly to shareholders, many of whom have said they will holdout for a sweeter deal.

Potash’s New York-listed shares continue to rise.