BHP Billiton blocked from Potash
Workers at a potash (Potassium Chloride) recovery plant.
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STEVE CHIOTAKIS: The Canadian government has blocked mining giant BHP Billiton's $40 billion takeover bid of the Canadian company Potash Corporation. The fertilizer potash is one of the most sought-after resources in the business world.
Marketplace's Stephen Beard reports.
STEPHEN BEARD: BHP's bid touched a raw nerve in Canada. The Potash Corporation in Saskatchewan produces almost a third of the global supply of the fertilizer. Many Canada's regard the company as a vital national resource. Especially in a world which will have to grow more food.
Max King is an analyst with Investec Asset Management. He says Canada's conservative government had to face the fact there's a lot of hostility in Saskatchewan to this foreign take over.
MAX KING: You can't ignore the politics of a situation like this and Saskatchewan has quite a number of conservative MP's who are fearful of losing their seats til this bid was blocked. In the real world, a lot of these decisions are based on politics.
The Canada government's ban is an interim measure. BHP now has 30 days to revise its bid. Many Canadians fear that if foreigners take control of the company there could be big job losses. But the government will be nervous about scaring away future foreign investors.
In London this is Stephen Beard for Marketplace.