There have been significant developments in the battle for supremacy of the Potash world in the last week. The Monday issuance of the much awaited Saskatchewan in the Spotlight report by the Conference Board of Canada will probably be viewed historically as a turning point. The independent report analyzes the "Risks and Opportunities" of the acquisition of PotashCorp and summarizes that there are 'few negatives' in BHPB's proposal. Overall, the report serves its generally intended purpose of providing reasonably wide cover for the politicians involved. Some of the trade press picked up on a tax nuance that would benefit BHPB if they operated both PotashCorp and continued to develop the Jansen Project. Governments make up tax laws on the fly. An extremely good example in fact is the royalty and taxation scheme that is already in place for the Saskatchewan potash industry. We would also suggest that this question is moot as we don't expect that Jansen will remain in BHPB's portfolio if they are successful.
In our last post we predicted some selling pressure. Tangentially, it now appears that PotashCorp's recently retired Chief Operating Officer has been a significant seller at recent market highs. His timing was pretty good given recent softness in POT shares.
And finally we have the entry of the plaintiff's bar into the fray; defending the rights of widows and orphans...and Hedge Funds with the filing of a class action suit. This firm has some pretty famous scalps on their trophy wall. Our uneducated guess is that their current filing will get some traction. If nothing else the complaint makes for interesting reading for the "Pot watchers" amongst us.
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