BHP Billiton cleared the first regulatory hurdle in its bid for Canada's Potash but the miner still has a long way to go to pass the deal with Canadian authorities and the target's shareholders.
BHP, the world's largest mining company, said it received antitrust clearance from the US Federal Trade Commission to proceed with its $39bn (£26bn) hostile bid for the world's largest fertilizer maker.
However, BHP's offer is still contingent on other regulatory approvals. The bid is likely to face much tougher scrutiny in Canada, where the country's competition watchdog has already requested additional information.
On Friday, investors and analysts said Potash's shareholders were the biggest obstacle to the deal.
"At the end of the day it is up to the shareholders and the buck stops with them if it even gets that far. At the moment shareholders are saying it is not enough," DJ Carmichael analyst James Wilson said.
Last month, BHP launched its hostile $130-a-share offer to acquire Potash. The Saskatoon, Saskatchewan-based company flatly rejected the bid as "grossly inadequate" and has filed a lawsuit against BHP in an attempt to stymie a takeover.
Potash's US-listed shares ended at $145.4, an 11.8 per cent premium to BHP's offer, suggesting investors anticipate a higher bid.
Analysts expect a competing bid to involve a Chinese entity such as Sinochem, which has hired two investment banks to advise it on options.
City A.M. Reporter