Uralkali Not In Talks With Belaruskali
Uralkali, which recently merged with Silvinit to become Russia's largest potash miner, is not planning to buy Belaruskali, a major Uralkali shareholder said on Friday.
"Talks are not ongoing, and in general I am not sure that a deal is possible," the shareholder said on condition of anonymity at the St. Petersburg Economic Forum.
Uralkali last week said it was "considering entering into a transaction with Belaruskali" but that no binding agreements had been signed.
The two companies are already joint venture partners in the Belarusian Potash Company (BPC) export vehicle, and Uralkali last week said that it may advance up to $1 billion to Belaruskali to secure future purchase volumes.
A merger of the two companies would create the world's largest potash producer, with annual capacity of 21.1 million tons, leap-frogging Canada's Potash Corp with 12 million.
The shareholder spoke on condition of anonymity because he "did not want to damage relations" with Uralkali's Belarussian partner.
Earlier this month, Belarus agreed to sell off $7.5 billion in state assets within the next three years as part of a deal to obtain $3 billion from a Russia-led bailout fund.
The agreement did not require the privatization of any specific firms, though analysts say potash miner Belaruskali is the most interesting asset.
Minsk has sent contradictory signals about its willingness to sell the firm.
President Alexander Lukashenko said earlier this month that Belarus will sell Belaruskali for $30 billion, while also denying that any sale talks have taken place.
In St. Petersburg on Friday, First Deputy Prime Minister Vladimir Semashko said there were no concrete plans to sell the asset.
"We have never discussed this deal with Uralkali...Belaruskali is not for sale," Semashko said according to Russian news agencies.
Countries are anxious to safeguard supplies of the fertilizer ingredient as the world battles food shortages and grows biofuels for energy supplies.
Potash prices are expected to rise to $600 a ton by 2012 from a spot price of $510-540 now, according to analysts at Troika Dialog.
