Ferilizer giant
Canadian-based Agrium, the largest North American retailer for farmers and the #3 producer of potash- and nitrogen-based fertilizers, got the go-ahead from the US Federal Trade Commission to buy US-based United Agri Products (UAP), a farm store retail chain. The deal is for $2.5 billion, including debt,
Agrium will have to sell off at least seven of UAP's 370 retail outlets, but will end up with a total of over 800 outlets in North America. Both companies sell such products as fertilizer, seeds, and agricultural chemicals to farmers across the US and Canada, while Agrium also has outlets in Latin America. The Agrium outlets go under such names as Crop Production Services and Western Farm Service.
Agrium this month also bought control of Common Market Fertilizers, a major European fertilizer distributor, one of nine acquisitions that the company has made in the last 10 years. These buys include both Nu-Gro Technologies and Pursell Technologies in 2006, both of which specialized in controlled-release fertilizers.
One of Agrium's areas of profit is in its control of potash resources in Canada, one of the few countries with natural deposits. Potash is following the course of other commodities like iron and copper. Demand from China is skyrocketing and supplies are limited geographically. Agrium, along with two other Canadian companies, Potash Corp. of Saskatchewan (#1) and Mosaic (#2), control most of the North American supply. (Mosaic's main stockholder is Cargill.)
Agrium through its acquisitions is gaining global scope as well as vertical scope, in that it mines, processes and retails. Fertilizer, like chemicals and seeds, is becoming a global industry with a limited number of players.
9:36:57 PM 
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