Indian regulator warns on Agrium-PotashCorp merger

New Delhi | Reuters — India’s competition regulator said the proposed merger between Agrium and PotashCorp was likely to hurt competition, a government statement said Wednesday.

The two Canadian fertilizer producers agreed to merge last September to navigate a severe industry slump by boosting efficiency and cutting costs.

Neither Agrium nor PotashCorp have physical presence in India, but both supply potash to India through Canpotex, their joint export venture with Mosaic Co.

“The commission is of the prima facie opinion that the proposed combination is likely to have an appreciable adverse effect on competition,” the Competition Commission of India said.

The regulator has sought public opinion on the deal and has directed the two firms to publish details of the proposed merger, the statement said.

The commission made similar comments a week ago about the proposed combination of chemical producers Dow Chemical and DuPont.

The Indian commission has now begun the second phase of its review process, similar to the process under way in the U.S., Canada and China, said PotashCorp spokesman Randy Burton.

“It is premature and inappropriate to speculate on whether any reviewing agency will object to the transaction or seek to impose conditions,” he said.

The commission’s comments are of little consequence to the Potash-Agrium merger because the companies do not own assets in India, said Bernstein analyst Jonas Oxgaard.

“The only regulators that really matter in this (are) Canada and the U.S., and neither of them have objections as near as we can tell,” he said.

— Reporting for Reuters by Sudarshan Varadhan in New Delhi and Rod Nickel in Winnipeg.