CF Industries urges Terra shareholders to support its revised offer

By Lisa Kerner

Charlotte, N.C., Nov. 3 - CF Industries Holdings, Inc. asked Terra Industries Inc. shareholders to support its revised offer for the company's shares and to elect CF Industries' three director nominees - John N. Lilly, David A. Wilson and Irving B. Yoskowitz - at the annual meeting on Nov. 20.

On Sunday, CF Industries increased its offer for Terra to include a cash component of $32.00 per share plus 0.1034 of a share of CF Industries common stock for each share of Terra common stock, including the $7.50-per-share special cash dividend declared by Terra.

The transaction is valued at $40.61 per share, according to CF Industries.

"We have changed the structure of our offer to a mostly cash transaction (from an all-stock transaction) to provide you with certainty on value as well as closing," CF Industries chairman, president and chief executive officer Stephen R. Wilson said in a letter to Terra shareholders on Tuesday.

CF Industries said Morgan Stanley has committed to provide $2.5 billion of financing to fund the transaction.

"The combined company will have a strong balance sheet and an enhanced financial platform with approximately $6 billion in total enterprise value," Wilson said.

On Monday, Terra announced it will consider CF Industries' revised offer.

Terra, a Sioux City, Iowa, nitrogen products company, rejected CF Industries' Sept. 28 unsolicited proposal to acquire the company for 0.465 of a share of CF Industries for each share of Terra.

Agrium Inc., a Calgary, Alta., fertilizer company, began an unsolicited exchange offer in March 2009 for CF Industries after CF Industries rejected its offer in favor of pursuing a deal with Terra.

In exchange for each CF Industries share, shareholders will receive $40.00 in cash plus one Agrium share.

Deerfield, Ill.-based CF Industries Holdings is the holding company for CF Industries, Inc., a producer and distributor of nitrogen and phosphate fertilizer products.

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