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Originally Posted by CGY
Yes, that's correct. The deal with need approval from the Competition Bureau as well as the Minister of Industry under the Ivestment Canada Act. It sounds like Viterra will be broken up and sold in pieces to Agrium, Glencore and Richardson, so any competition concerns will likely be alleviated. The feds will likely want some undertakings from the buyers before providing Investment Canada Act approval... I'm sure Mr. Wall will be pushing to keep jobs in Regina, but seeing that Richardson and Agrium are already established in Winnipeg and Calgary, this may lead to some issues. It will be interesting to watch this unfold.
Don't forget the deal will also need shareholder approval from Viterra shareholders.
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They won't be splitting the company evenly into thirds. Richardson and Agrium will be taking parts that align with their specialities/business. This wouldn't alleviate competition concerns. I believe Richardson is the #2 grain handler in Canada next to Viterra, so combining 1 and 2 would have a huge market share. And I know Agrium is #1 in their business (not sure where Viterra's operations place them). But in any case, I don't think this will be an easy process through the Competition Bureau.
As for shareholders, chances are they'd probably cash in as the price will be around a 45% premium over where the stock was a month ago.
Edit: From the sounds of it, Glencore would keep 77% of the grain handling business, which could alleviate some of the competition concerns and maintain their operations in Regina (as a new entrant, it would probably be the easiest solution to utilise an already set up head office), so those two moves probably will go a long way in gaining support from the different levels of government. Not sure about the fertilizer/Agrium part of the deal... But it will be interesting seeing what happens with the market without the CWB.