(Adds comment from Potash Corp, analyst)
By Sudarshan Varadhan and Rod Nickel
NEW DELHI/WINNIPEG, March 29 India's competition
regulator said the proposed merger of fertilizer producers
Agrium Inc and Potash Corp of Saskatchewan Inc
is likely to hurt competition, but the comments were not
expected to prevent the merger.
Potash Corp and Agrium agreed to merge last September to
navigate a severe industry slump by boosting efficiency and
Neither Canadian company has a physical presence in India,
but they supply potash to India through Canpotex Ltd, which they
own with Mosaic Co.
"The commission is of the (initial) opinion that the
proposed combination is likely to have an appreciable adverse
effect on competition," the Competition Commission of India
said, according to a government statement on Wednesday.
The commission made similar comments a week ago about the
proposed combination of chemical producers Dow Chemical Co
The Indian commission has now begun the second phase of its
review process, similar to the process under way in the United
States, Canada and China, said Potash 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.
The Indian regulator has sought public opinion on the deal
and has directed the two firms to publish details of the
proposed merger, the government statement said. The companies
complied last week, Burton said.
Potash and Agrium shares traded less than 1 percent higher
in afternoon trading.
(Reporting by Sudarshan Varadhan in New Delhi and Rod Nickel in
Winnipeg, Canada; Editing by Malini Menon and Phil Berlowitz)