Potash sails through $145

The world didn’t end, after all

It was less than a month ago that BNN TV Squeeze Play co-host Rudyard Griffiths asked me a fair question: why shouldn’t Potash (POT:TSX) shareholders be able to sell to BHP for $145/share? At the time, market rumours suggested that to win-over the Potash board, BHP would raise its bid from $130 to something like $145. Being a free-marketer, Mr. Griffiths likely thought I’d lost my mind by advocating that Canada wise-up to the uneven global playing field when it comes to takeovers of important resource assets or national corporate champions (see prior post “Playing with political fire on Potash file” Oct 28-10).

When Industry Minister Tony Clement turned the proposed BHP/Potash deal down, there was much caterwauling about Potash’s hard done shareholders. They’d been denied their chance for a great takeout price, blah, blah, blah.

Well, POT closed at $145.40 last night. If you wanted to tender to BHP at $145/share, it’s now yours for the taking on the TSX; the extra 40 cents will cover the trading commission. And Saskatchewan won’t lose billions in tax revenue. Aren’t you glad Mr. Clement stood up for Canada?

MRM
(disclosure: I own POT and am short Dec. POT calls)