Monday, September 20, 2010

"Sinochem seeks government support for Potash bid: report" (POT)

With about a half-hour to go the stock is up $1.11 at $148.39.
Not too hard to see this coming.*
From Reuters:
Chinese chemical conglomerate Sinochem Group has formally asked the government to back a bid for Canada's Potash Corp (POT.TO) (POT.N), a local newspaper reported on Sunday.
The Economic Observer cited sources close to the deal as saying that, according to a preliminary assessment, Sinochem would need $40 billion to $60 billion to trump a $39 billion hostile offer by BHP Billiton (BHP.AX)(BLT.L) for Potash Corp.

The amount would be too much for Sinochem, which reported $25 billion in total assets at the end of 2009, the Beijing-based weekly newspaper cited analysts as saying.

In its application to the government, Sinochem argued that Beijing should back a bid for the Canadian firm because potash is key to China's national food security, the paper said.

The Economic Observer's story chimes with a report last Friday by the Globe and Mail in Toronto that Sinochem was trying to drum up support for a Chinese-led bid for Potash Corp.
Sinochem is the parent of China's largest fertilizer company, Sinofert (0297.HK)...MORE

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"How likely is a Chinese bid for Potash Corp?" as Government May Order Firms to Bid (POT) 
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