At first it sounded like it an outlier possibility, that the Chinese would come over the top of BHP Billiton and snatch away Canadian fertiliser player Potash.
But it sounds very, very real, and perhaps imminent.
The plan being considered would include significant capital from a Chinese resource company or investment fund, which would then be combined with smaller contributions from international sovereign wealth funds and possibly Canadian financial players such as pension funds. Strategic partners such as rival potash producer Mosaic Co. could also be part of the consortium, sources say.
Together, these investors could provide enough capital to account for as much as half of the funds needed for an offer that would top the BHP’s $130 per share unsolicited bid. The rest of the offer to shareholders would be financed through debt as well as potential asset sales, and key management from Potash Corp. would remain in place to run the company.
What’s key is that it would combine several different players — including Canadian ones — thus likely placating regulators, who would be wary of having Potash fully owned by the Chinese.