Norwegian fertilizer group Yara won’t up bid for Terra after higher CF acquisition offer

Yara won’t up bid for Terra

OSLO — Norwegian fertilizer company Yara International ASA said Friday it will not increase its offer to acquire U.S. competitor Terra Industries after Terra’s board chose to favor a higher bid from CF Industries.

Yara CEO Joergen Ole Haslestad said that while Terra is “a perfect fit” for Yara at the original price of $4.1 billion the Oslo-based company would not increase its offer. The company did not further specify why it was declining to continue its pursuit of Terra.

Chemical maker CF Industries Holdings Inc., based in Deerfield, Illinois, last week offered to buy Terra Industries Inc. in a cash and stock deal valued at $4.7 billion.

Sioux City, Iowa-based Terra said Wednesday it favored CF’s bid over Yara’s and gave Yara five business days to respond.

If Terra chooses the new bid from CF, Terra will owe Yara a $123 million break-up fee, according to Yara.

Haslestad said Yara still hopes to break into the U.S. market.

“The U.S. remains an attractive market for us, and we will continue to search for opportunities to grow our business in the region,” Haslestad said.

He did not, however, say how Yara might next approach the U.S. market.