Agrium set to acquire Royster-Clark

Article Excerpt

AGRIUM INC. $28 (Toronto symbol AGU; SI Rating: Average) has raised its takeover offer for U.S. fertilizer distributor Royster-Clark Ltd. by 8.2%, to $387 million from $357.5 million. It originally offered $325 million in November 2005. If you include Royster- Clark’s debt, the overall value of this new deal is roughly $616 million (all amounts in Canadian dollars). To put that in context, Agrium earned $2.12 U.S. a share (total $283 million U.S.) in 2005 on sales of $3.5 billion U.S. Royster-Clark has now accepted the new offer, and is recommending that its investors tender their units. Agrium now aims to complete the purchase by the end of February. Royster-Clark’s 250 farm centres and 70 fertilizer-storage sites in the Midwestern and Southeastern U.S. should add $1 billion U.S. to Agrium’s annual sales. Agrium is a buy. buy…

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