Fertilizer Wars Prove Beneficial for Stocks

CF Industries Holdings Inc. offered to buy rival Terra Industries Inc. for $4.73 billion, challenging a bid from Yara International ASA and seeking to form the largest U.S. maker of nitrogen-based crop fertilizers, according to Bloomberg.

The proposal includes $37.15 in cash and 0.0953 of a CF share for each Terra share, CF said today in a statement. Based on yesterday's closing prices, the offer is valued at $47.40 a share, representing a 15 percent premium to Terra's share price. CF's bid rivals an offer from Yara, the world's largest fertilizer maker, which agreed to buy Terra for $4.1 billion last month. CF in January dropped a yearlong attempt to acquire Terra while fending off a hostile bid from Calgary-based Agrium Inc.

The shakeout of these fertilizer wars has been a boost to companies like FMC and SQM, which are rising 2-3% today on the back of the consolidation news.