Glencore to sell Viterra’s stake in Canadian Fertilizers to CF Industries for $911 mn

Commodities trading giant Glencore International yesterday agreed to sell a 34-per cent stake in Canadian Fertilizers Ltd (CFL) currently owned by Viterra Inc to CF Industries Holdings Inc for C$915 million ($911 million) in cash, as part of its proposed C$6.1 billion acquisition of Viterra Inc.

The proposed deal comes after Glencore scrapped plans to sell the stake to farm products retailer Agrium Inc on competition issues raised by the Canadian regulators.

Glencore, which is in the midst of merging with mining group Xstrata, had in March proposed to buy Viterra, Canada's largest grain handling company for C$6.1 billion. (See: Glencore to acquire Canadian grain handler Viterra for $6.2 bn).

The Baar, Switzerland-based company had roped in two Canadian partners for the deal - fertiliser company Agrium and grain handling firm Richardson International, both of whom, were to buy most of Viterra's Canadian business for $2.6 billion.

Glencore had deliberately brought in the Canadian partners to the deal in order to avoid concerns over foreign ownership of Canadian resource companies.

Under the side deal, Viterra's Canadian grain-handling assets, including 19 grain elevators as well as shipping facilities at Vancouver and Thunder Bay, some agri-centres and processing assets in North America are to be sold to privately-owned Winnipeg-based Richardson, for $800 million in cash.