* Says board has approved a 3-for-1 stock split
* Stock split to help boost trading liquidity
* Move seen as sign of confidence in potash business
* Share price has jumped since failed takeover in November
(Adds analyst comment, details; Figures in U.S. dollars)
By Euan Rocha
TORONTO, Jan 26 Potash Corp (POT.TO), the
world's largest fertilizer producer, said on Wednesday its
board approved a three-for-one split of its common shares in a
move to improve trading liquidity following a recent jump in
the stock price.
Potash Corp, the target of a failed $39 billion takeover
bid last year, will also raise its quarterly cash dividend from
10 cents to 21 cents a share on a pre-split basis. On a
post-split basis the payout will equal 7 cents a share.
"This should definitely be regarded as positive because it
is a sign that the company believes in the long-term strength
of the potash business," said Gleacher & Co. analyst Edlain
The company is the No. 1 producer of the crop nutrient
potash, a mineral that comes from underground mines in the
Canadian province of Saskatchewan. The outlook for potash and
other fertilizers is at the strongest in years as farmers rush
to maximize yields whle grain prices are at fresh highs.
Shares of Potash Corp recently hit a 28-month high of
$174.31 in New York. That compares with $130 offered last
summer by BHP Billiton (BHP.AX), the mining giant who's hostile
bid was blocked by Canada's government in November.
The shares, which closed at $168.62 on Wednesday, have
climbed steadily since the failed takeover. The gains reflect
the company's strong performance at the end of 2010 and even
more robust expectations for the coming year.
Potash Corp is expected to post a big jump in profits when
it reports fourth-quarter results early on Thursday, as surging
grain prices have helped boost demand across the globe.
STOCK DIVIDEND TO SHAREHOLDERS
The company said it will pay out the three-for-one stock
split to shareholders in the form of a stock dividend, with
each receiving two additional shares for each share owned on
the record date of Feb. 16. The plan is subject to regulatory
Rodriguez said the split, which effectively lowers the
price of a single share, would attract more retail investors to
Upon completion of split the number of shares outstanding
will total about 853 million.
The stock split will have no unfavorable tax consequences
in either Canada, or the United States, the company said.
(Reporting by Euan Rocha; Editing by Frank McGurty)