BHP Largest Mining Company Repurchase Share Offer Potash Bid

BHP Billiton Ltd the world largest mining company repurchase of shares offer for Potash Corp. of Saskatchewan Inc. of Canada following rejection of the bid after leaving the 40 billion U.S. dollars cash.

BHP to buy share s4.2 billion U.S. dollars under a buyback of $ 13,000,000,000 shares was suspended in 2007, the Melbourne-based company said today in a statement. BHP, which said the offer could not Canada?s requirements, had 30 days to appeal after November 3 rejection. Stephen Harper said that sales of the world?s largest fertilizer would not benefit Canada. It is the third time Chief Executive Officer Marius Kloppers, 48, has failed to consummate a deal in the past two years, scoring at least $ 800 million in transaction costs.

BHP, which as much as $ 25 billion to spend on buying shares, according to Morgan Stanley rose 0.5 percent to A $ 44.51 at 12:19 pm Sydney time on the Australian Stock Exchange. The cost of protecting bonds from default BHP declined to 80.5 basis points in Sydney 9:11, according to Nomura Holdings Inc., which is 3.2 basis points below its closing price on November 12 the data provider CMA prices show. The buyback is probably not as much as some people wanted, ?said Tim Schroeder, who helps manage about $ 1 billion to Pengana Capital Ltd. in Melbourne, including BHP shares. The demolition of the deal is ?probably indicative that it was quite difficult in terms of meeting the original deadline and not really a plan B or a play to go forward,? he said.

Second rejection

Potash Corporation spokesman Bill Johnson did not immediately respond to calls outside normal business hours by Bloomberg. Potash Corp CEO Bill Doyle had rejected the deal, saying the price was too low amid rising prices for grain and crop nutrient company namesake.

Tony Clement Industry Minister decision to block the deal was only half of the nation?s rejection of a foreign takeover in the past 25 years. He said Nov. 4 that the proposed deal is not a ?net benefit? to Canada has to offer, adding that he was legally prevented from explaining the rejection in public.

?This is the realization that there is a low to no chance a deal can get done right now,? Louis Meyer, a New York-based special situations analyst at Oscar Gruss & Son Inc., said in an interview. ?It is not surprising given the roadblocks raised, including price regulation and rejection.?

Additional commitments

Kloppers had obtained 45 billion U.S. dollars in loans in September to the proposed acquisition, which met with opposition from politicians and fund investors. The failed bid will be a transaction charge of approximately $ 350,000,000 rise, BHP said.

?The company believes that the Minister of Industry would then additional companies have demanded that BHP Billiton had been offered that would conflict with the business strategy and BHP Billiton is contrary to shareholder value,? BHP said in the statement . The company undertakes at least $ 1 billion in investments and businesses in Canada to spend as part of the deal.

JPMorgan Chase & Co. and nine other banks could lose an estimated $ 120 million consultancy fees, according to estimates by research firm Freeman Consulting. In addition to consultancy fees, the bank financing to get as much as $ 190 million loan to settle, said Freeman. Most of the loan, charges already paid, Freeman said.

Deal Kill Under Investment

Under the Investment Canada Act, the government can block any transaction valued at EUR 299 million (298 million U.S. dollars) or more, if it finds that does not provide a ?net benefit? to the country, based on factors such as production and employment . The government came under pressure from the province of Saskatchewan, who said Potash Corp. ?s sale would lead to job losses and tax revenue and control of an important source surrender.

?It was the way BHP approached both Canada and Potash Corp. that the deal is slain,? Mark Connelly, a New York-based analyst at Credit Agricole SA, said in a telephone interview. ?They turned this into a political issue by being so hostile to a flat rate to Canada.?

BHP had committed to spending $ 450 million over the next five years on exploration and development and 370 million U.S. dollars on infrastructure funds in Saskatchewan and New Brunswick, the company said today. He would have applied to list on the Toronto Stock Exchange, lost tax benefits and a member of the Canpotex, the marketing company jointly owned by Potash Corp., Agrium Inc. and Mosaic Co., stayed for five years, he said today.

Rio Offers

Kloppers, was appointed CEO in May 2007, scrapped its hostile bid for Rio Tinto Group in 2008 and a joint venture with the same company was abandoned last month. He spent 450 million U.S. dollars on the acquisition of Rio, the company said. He also submitted $ 75,000,000 in the venture with Rio, the Australian Financial Review reported.

Canada plans to ?support? of investors on what kinds of foreign takeovers will tolerate, Harper told reporters yesterday at the Asia-Pacific Economic Cooperation summit in Yokohama, Japan, said he will continue the policy outline once a 30-day appeal process for BHP ends.

Acquisition Targets

Upon entering Potash Corp., the world?s largest producer of crop nutrient, was knockers trying to profit from rising demand for chemical fertilizer and food to grow and the list of possible targets business shrinks. The acquisition would have been BHP?s biggest since buying WMC Resources Ltd. in 2005 and the biggest acquisition this year.

Anadarko Petroleum Ltd. and Woodside Petroleum Ltd may be acquisition targets for BHP, UBS AG has said Nov. 5. Riversdale Mining Ltd, which is close to US-based Drummond Coal Company Co. and other major potash producer is also kept potential targets, he said.

New York-based JPMorgan, Toronto-Dominion Bank, Banco Santander SA, Barclays Plc, BNP Paribas SA, Royal Bank of Scotland Group Plc and Canadian Imperial Bank of Commerce were BHP?s advisers on the deal, according to data compiled by Bloomberg. Kali Corp. was advised by Bank of America Corp., Goldman Sachs Group Inc. and Royal Bank of Canada. bhp potash 800million??bhp bid news release.