PotashCorp asks court to stop 'misleading' BHP bid
Last Updated: Wednesday, September 22, 2010 | 10:37 AM ET
Potash Corporation of Saskatchewan is taking to the courts to escalate its fight to rebuff a takeover by international miner BHP Billiton Ltd.BHP Billiton Ltd. is attempting to purchase Potash Corporation of Saskatchewan, and the latter took to the courts to try to rebuff the bid Wednesday. (CBC)
PotashCorp filed papers in the U.S. District Court for the Northern District of Illinois on Wednesday that allege BHP used "false and misleading" statements in its $40-billion pursuit of the Saskatoon-based firm.
The company alleges BHP is trying to scoop up PotashCorp "on the cheap" by using coercive tactics. The filing notes that BHP's offer is conditional on obtaining 50 per cent of the common shares — not 66.6 per cent as required under Canadian law.
That's coercive, PotashCorp says, because half of the company's shareholders could theoretically not tender to the offer and yet still be held hostage by a controlling BHP without offering them a clear exit strategy.
The filings also allege that BHP has had aims on PotashCorp dating back to 2001, and was systemically acting to drive down PotashCorp's stock price to make an acquisition easier to swallow.
BHP recently extended its deadline for shareholders to tender by a month, to Nov. 18.
Officials from BHP were not immediately available for comment.
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