Uralkali that it had agreed to acquire Silvinit for $8.1 billion in cash and shares, combining two Russian potash producers to create a major new player in the global market for the fertilizer ingredient. Uralkali is paying Silvinit $1.4 billion in cash for 20 percent of its ordinary shares, and giving Silvinit stockholders 133.4 Uralkali shares for each ordinary share, and 51.8 for each preferred share, in Silvinit.
Uralkali shares fell 10.17 rubles, or 4.731 percent, to 204.8 rubles, in Moscow.
Anna Kupriyanova, an analyst with Uralsib, said the deal was good for Uralkali shareholders, since they appeared to be getting Silvinit at a discount.
The combined company will have a market capitalization of $23.9 billion, measured by Friday’s share prices, which will make it one of the largest potash companies in the world. About 84 percent of its production will go to export markets like other BRIC nations as well as Southeast Asia, Uralkali said.
The deal is expected to close in the second quarter of next year.
It comes after abandoned a nearly $40 billion hostile takeover effort of the Potash Corporation of Saskatchewan last month because of opposition from Canadian officials.