Protectionism reigns as Canada blocks potash bid
Published: Thursday, 04 November 2010
Deal not dead: 30 days for BHP response, PotashCorp reiterates low value of bid
PotashCorp and BHP Billiton have been left deflated after the
Canadian government took the rare step and blocked its
unsolicited $38.6bn bid.
that BHPs bid to enter the world of fertiliser minerals
offered no benefit to the country, a decision that has been
widely criticised in the free market.
It is only
the second time in history that Canada has blocked a
I can confirm that I have sent a notice to BHP Billiton
indicating that, at this time, I am not satisfied that the
proposed transaction is likely to be of net benefit to
Canada, said Canadas minister of industry, Tony
Reasons behind the move could not be given at the time with a
30 day appeal process now in motion, but political pressure,
particularly form PotashCorps home-province of
Saskatchewan was intense with domestic legal action
But while the country has not outline reasons for blocking the
bid, they appear to be few and far between.
This has put Canadas once open policy on foreign
investment under question.
Clement said: Canada has a long-standing reputation for
welcoming foreign investment. The Government of Canada remains
committed to maintaining an open climate for
BHP said it was disappointed in the outcome while
PotashCorp reiterated the low value of the $130/share bid.
The few words of reaction from both companies strongly suggest
a deal is still on the cards in the business arena, but in
Canada it appears the power now lies with the
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