BHP Billiton acquire Canada’s Athabasca Potash for $320 million
29 Jan 2010
BHP Billiton, the world's largest mining company said yesterday that it has agreed to acquire Canadian potash explorer Athabasca Potash Inc., (API) for $320 million in cash, to add potash exploration properties in the Canadian province of Saskatchewan.
API is a Toronto Stock Exchange-listed, junior potash company that owns the Burr Project and various potash exploration properties in Saskatchewan, Canada holding one of the largest exploration permit areas in the Saskatchewan basin, covering approximately 6,900 km.
The Anglo Australian miner is paying C$8.35 per share in cash for Athabasca, a 25 per cent premium to Athabasca's Wednesday closing price of C$6.70.
API has agreed not to solicit or initiate any discussion regarding any other business combination or sale of material assets. API has also granted BHP Billiton a right to match any superior proposal and will pay a termination fee of $12 million to BHP Billiton if the definitive agreement is terminated if API recommends or approves an acquisition proposal with another buyer.
The Burr Project is located adjacent to BHP Billiton's Jansen Project and some of API's exploration properties are close to BHP Billiton's potash permit areas.
Acquiring API will give the Melbourne-based BHP Billiton access to a total of more than 14,000 km of prospective exploration ground in the world-class Saskatchewan potash basin.
