Blocking BHP's move on Potash Corp could be damaging for Canada. The government will decide by Wednesday whether to allow the $39 billion deal to proceed. A BHP takeover might squeeze the tax the fertilizer giant pays its home province. But those costs are outweighed by the discount that the country's companies would suffer if Canada was deemed to have turned protectionist.
The Great Debate UK
BHP Billiton is playing a waiting game. The longer regulators take to approve the miner's $38.6 billion offer for Canada's Potash Corporation of Saskatchewan, the more time there is for a rival bid to emerge. Yet any white knight is bound to face similar scrutiny. BHP's one-month head start in the lengthy process could prove to be a tactical advantage.
Potash prices are crucial to how far BHP Billiton can stretch its $39 billion hostile bid for Canada's Potash Corporation of Saskatchewan. The miner's offer is essentially a bet on demand for the commodity, which accounts for the bulk of the fertiliser giant's value.