WASHINGTON - Canadian fertilizer maker Agrium Inc (AGU.TO), which is attempting a hostile takeover of rival CF Industries (CF.N), has won U.S. antitrust approval of the proposed transaction after agreeing to sell two plants, the Federal Trade Commission said on Wednesday.
Agrium will sell two anhydrous ammonia plants in the Pacific Northwest and in Marseilles, Illinois, to Terra Industries (TRA.N). The plants produce a type of nitrogen fertilizer widely used by farmers to grow corn, soybeans and other crops.
The plant sales are intended to preserve competition in the farm fertilizer market, the FTC said.
Agrium will also give up its exclusive rights to sell anhydrous ammonia produced at a Rentech Inc (RTK.A) plant in East Dubuque, Illinois, the agency said. Rentech will receive the rights to market the anhydrous ammonia produced at its own plant.
Each of these markets is highly concentrated, the FTC said, and the proposed transaction would further increase concentration levels by reducing the number of significant competitors in the Pacific Northwest from two to one, and in the two areas in Illinois from three to two.
The proposed deal would likely boost prices for the farm fertilizer without the conditions imposed by regulators, the FTC said.
Under the consent order with the FTC, Agrium also agreed to give antitrust regulators advance written notice if it plans to buy an interest in any anhydrous ammonia assets during the coming 10 years.
Agrium shares were up 13 Canadian cents at C$64.21 on the Toronto Stock Exchange, while CF rose 0.6 percent to $86.97 on the New York Stock Exchange.
The FTC posted a copy of its consent order at: here
(Reporting by Julie Vorman; Editing by Lisa Von Ahn)