LEGAL tussle between mining group BHP Billiton and takeover target Potash moved several steps closer to an end yesterday, as Canadian regulators set a date for their hearing and the US courts heard more about Potash’s objections to the takeover.
The Saskatchewan securities regulator said it will hear BHP’s challenge to Potash’s “poison pill” shareholder rights plan on 8 November. The world’s biggest miner has called on the Canadian authorities to halt trading in Potash’s new diluted shares, which were created on 16 August shortly after BHP’s $39bn (£24.7bn) hostile takeover offer.
A poison pill defence makes it more difficult for a predator to gain enough shares to complete a takeover. Potash claimed the share issue was intended to give shareholders and the board “adequate time… to identify, develop and negotiate value-enhancing alternatives” to BHP’s $130 a share offer, which expires on 18 November.
The hearing is set to take place after the Canadian federal government’s decision on whether to block BHP’s bid, which is due on 3 November.
Saskatchewan’s provincial government said last week it could not support the current offer.
Meanwhile, Potash has altered its own legal complaint in the US courts, which originally claimed that BHP misrepresented and failed to inform investors about material facts relating to its bid. The details of Potash’s amendment have not been made public, but a court hearing has been set for 4 November.