UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant ¨
Filed by a Party other than the Registrant x
Check the appropriate box:
| ¨ Preliminary Proxy Statement |
¨ Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
| ¨ Definitive Proxy Statement |
||
| x Definitive Additional Materials |
||
| ¨ Soliciting Material Pursuant to §240.14a-12 |
||
CF INDUSTRIES HOLDINGS, INC.
(Name of Registrant as Specified In Its Charter)
AGRIUM INC.
NORTH ACQUISITION CO.
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
| x | No fee required. |
| ¨ | Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. |
| (1) | Title of each class of securities to which transaction applies: |
| (2) | Aggregate number of securities to which transaction applies: |
| (3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined): |
| (4) | Proposed maximum aggregate value of transaction: |
| (5) | Total fee paid: |
| ¨ | Fee paid previously with preliminary materials. |
| ¨ | Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. |
| (1) | Amount Previously Paid: |
| (2) | Form, Schedule or Registration Statement No.: |
| (3) | Filing Party: |
| (4) | Date Filed: |
 Fundamentals of Growth Agrium and CF: Growing Across the Value Chain April 2009 |
 Fundamentals of Growth 2 Important Information This presentation does not constitute an offer to exchange, or a solicitation of an offer to exchange,
common stock of CF Industries Holdings, Inc. (“CF”), nor is it a substitute for the
Tender Offer Statement on Schedule TO or the Prospectus/Offer to Exchange included in the Registration Statement on Form F-4 (including the Letter of Transmittal and related documents) (collectively, as amended from time to
time, the “Exchange Offer Documents”) filed by Agrium Inc. (“Agrium”) with
the U.S. Securities and Exchange Commission (the “SEC”) on March 16, 2009, as amended. The Registration Statement on Form F-4 has not yet become effective. The offer to exchange is made only through the Exchange Offer
Documents. INVESTORS AND SECURITY HOLDERS OF AGRIUM AND CF ARE URGED TO READ THE EXCHANGE
OFFER DOCUMENTS AND OTHER RELEVANT MATERIALS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY AS
THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE OFFER TO
EXCHANGE. In connection with the solicitation of proxies for the 2009 annual meeting of stockholders of CF, Agrium
and its wholly-owned subsidiary North Acquisition Co. (“North”) filed a
definitive proxy statement with the SEC on April 6, 2009. The definitive proxy statement of Agrium and North and accompanying proxy card will be mailed to stockholders of CF. INVESTORS AND SECURITY HOLDERS OF CF ARE URGED TO READ THE
PROXY STATEMENT AND OTHER RELEVANT MATERIALS CAREFULLY IN THEIR ENTIRETY AS THEY BECOME
AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Copies of any documents filed by Agrium with the SEC are available free of charge through the web site
maintained by the SEC at www.sec.gov, by calling the SEC at telephone number
800-SEC-0330 or by directing a request to the Agrium Investor Relations/Media Department, Agrium Inc, 13131 Lake Fraser Drive S.E., Calgary, Alberta, Canada T2J 7E8. Free copies of any such documents can also be
obtained by calling Georgeson Inc. toll-free at (866) 318-0506. Agrium, North, their respective directors and executive officers and certain other persons are deemed to be
participants in the solicitation of proxies from CF stockholders for CF’s 2009 annual
meeting of stockholders. Information regarding such participants and a description of their direct and indirect interests in such solicitation, by securities holdings or otherwise, is contained in the definitive proxy
statement filed by Agrium and North with the SEC on April 6, 2009. Agrium, North, their respective directors and executive officers and certain other persons may be deemed to
be participants in any solicitation of proxies from CF’s stockholders in respect of the
proposed transaction with CF. Information regarding Agrium’s directors and executive officers is available in its management proxy circular dated April 3, 2009 relating to the annual general meeting of its shareholders to
be held on May 13, 2009. Other information regarding potential participants in such proxy
solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in any proxy statement filed in connection with the proposed transaction. All information in this presentation concerning CF, including its business, operations and financial
results, was obtained from public sources. While Agrium has no knowledge that any such
information is inaccurate or incomplete, Agrium has not had the opportunity to verify any of that information. |
 Fundamentals of Growth 3 Forward-Looking Statements Certain statements and other information included in this presentation constitute “forward-looking
information” within the meaning of applicable Canadian securities legislation or
“forward-looking statements” (together, “forward-looking statements”). All statements in this presentation, other than those relating to historical information or current condition, are forward-looking statements, including, but not
limited to, estimates, forecasts and statements as to management’s expectations with
respect to, among other things, business and financial prospects, financial multiples and accretion estimates, future trends, plans, strategies, objectives and expectations, including with respect to future operations
following the proposed acquisition of CF. These forward- looking statements are subject to a
number of risks and uncertainties, many of which are beyond our control, which could cause actual results to differ materially from such forward-looking statements. Events or circumstances that could cause actual
results to differ materially from those in the forward- looking statements, include, but are
not limited to, CF’s failure to accept Agrium’s proposal and enter into a definitive agreement to effect the transaction, Agrium common shares issued in connection with the proposed acquisition may have a market value lower than
expected, the businesses of Agrium and CF, or any other recent business acquisitions, may not
be integrated successfully or such integration may be more difficult, time-consuming or costly than expected, the expected combination benefits and synergies and costs savings from the Agrium/CF transaction
may not be fully realized or not realized within the expected time frame, the possible delay in
the completion of the steps required to be taken for the eventual combination of the two companies, including the possibility that approvals or clearances required to be obtained from regulatory and other
agencies and bodies will not be obtained in a timely manner or will be obtained on conditions
that may require divestiture of assets expected to be acquired, disruption from the proposed transaction making it more difficult to maintain relationships with customers, employees and suppliers, general business and
economic conditions, interest rates, exchange rates and tax rates, weather conditions, crop
prices, the supply, demand and price level for our major products, gas prices and gas availability, operating rates and production costs, domestic fertilizer consumption and any changes in government policy in key
agriculture markets, including the application of price controls and tariffs on fertilizers and
the availability of subsidies or changes in their amounts, changes in development plans, construction progress, political risks, including civil unrest, actions by armed groups or conflict, governmental and regulatory
requirements and actions by governmental authorities, including changes in government policy,
changes in environmental, tax and other laws or regulations and the interpretation thereof and other risk factors detailed from time to time in Agrium and CF’s reports filed with the SEC. Agrium
disclaims any intention or obligation to update or revise any forward-looking statements in
this presentation as a result of new information or future events, except as may be required under applicable U.S. federal securities laws or applicable Canadian securities legislation. These forward-looking statements are based on certain assumptions and analyses made by us in light of
our experience and perception of historical trends, current conditions and expected future
developments as well as other factors we believe are appropriate in the circumstances. Expected future developments are based, in part, upon assumptions respecting our ability to successfully integrate the
businesses of Agrium and CF, or any other recent acquisitions. All of the forward-looking statements contained herein are qualified by these cautionary statements and
by the assumptions that are stated or inherent in such forward-looking statements. Although
we believe these assumptions are reasonable, undue reliance should not be placed on these assumptions and such forward-looking statements. The key assumptions that have been made in connection with the
forward-looking statements include, but are not limited to, CF’s acceptance of
Agrium’s proposal and the entering into of a definitive agreement to effect the proposed transaction, closing the proposed transaction, the market value of Agrium common shares issued in connection with the proposed acquisition,
our ability to successfully integrate within expected time frames and costs, and realize the
expected combination benefits and synergies and costs savings from the combination of the businesses of Agrium and CF, or any other recent business acquisitions, and our ability to maintain relationships with
customers, employees and suppliers during the course of the proposed transaction.
|
 Fundamentals of Growth 4 Revised Offer Summary 76% Agrium and 24% CF Pro Forma Ownership: • $35.00 in cash and 1 Agrium share • Aggregate consideration of $1.8 billion cash and 50.2 million shares • CF shareholders may elect mixed consideration, or cash or shares, subject to proration Consideration: Committed debt facilities from Royal Bank of Canada and The Bank of Nova Scotia Financing: • Negotiation of definitive merger agreement • CF offer for Terra terminated • Receipt of regulatory and other customary approvals • Absence of any material adverse changes to CF or its business • Our ability to conduct limited confirmatory due diligence Key Conditions: • Cash component increase of $3.30, or 10.4% over Agrium’s initial cash component • 35% to CF closing price on February 24 and 48% to 30-day VWAP through February 24 (based on mixed consideration and Agrium price on March 26) Premium: Agrium to combine with CF in a cash and stock deal Offer: |
 Fundamentals of Growth 5 Withhold Vote Campaign |
 Fundamentals of Growth 6 Background • Agrium files exchange offer to acquire CF (3/16) – Disclosed 2.6% toe-hold position established in February Mar 15 • CF files 14D-9 (3/23) • Agrium increases offer to acquire CF (3/27) – $35.00 in cash plus 1 Agrium share – Launches withhold vote campaign; files preliminary proxy – Announces that shortly after 2/25 initial proposal it had commenced informal discussions with FTC; formal HSR filing on 3/24 • CF restructures collar; claims value of revised offer increased to $30.50 (3/23) • Terra Board rejects CF’s revised proposal (3/24) Mar 22 • CF Board rejects Agrium’s proposal (3/9) • CF amends proposal to acquire Terra (3/9) – Introduces collar; claims value of revised offer increased to $27.50 – Restructured offer to include non-voting preferred stock • Attempting to circumvent CF stockholder vote • Potentially in contravention of NYSE voting rules • Terra Board rejects CF’s revised proposal (3/11) • CF launches proxy contest to elect three directors to Terra Board (3/12) Mar 8 • CF Board rejects Agrium’s revised offer (3/29) • Agrium files amended exchange offer to acquire CF (3/30) Mar 29 • Agrium announces proposal to acquire CF (2/25) – $31.70 in cash plus 1 Agrium share – Fully-committed financing • CF files exchange offer to acquire Terra (2/23) – Excessive conditionality Feb 22 • Terra Board rejects CF’s offer (3/5) Mar 1 • CF announces proposal to acquire Terra (1/15) – 100% stock transaction, $20.00/share – Transaction subject to CF stockholder vote under NYSE rules CF / Terra Jan 11 Agrium / CF Week |
 Fundamentals of Growth 7 • CF restructured its offer for Terra for the sole purpose of circumventing a CF stockholder vote on the Terra deal – CF is doing an end-run around its stockholders and has taken away their vote
– We believe this highlights CF’s belief that they would lose a vote – Even as restructured, CF’s proposed structure could violate NYSE Rule 312.03(b) regarding the need to hold a stockholder vote • CF has refused to engage with Agrium – Despite our expressed willingness to increase Agrium’s offer if CF were to
engage in discussions and demonstrate additional value • Significant CF stockholders have expressed their preference to receive a premium from Agrium rather than pay a premium for Terra – Current CF trading levels indicate investor support for an Agrium / CF combination – Conversations with certain CF stockholders confirm this support CF Ignoring Interests of its Stockholders |
 Fundamentals of Growth 8 • Three CF directors standing for re-election at CF’s annual meeting on April 21 • Agrium filed a definitive proxy on April 6 with the SEC, and will be actively soliciting proxies from CF stockholders to withhold their votes on election of CF directors • Significant withhold vote percentage will send a clear and strong message to CF Board and management We Urge CF Stockholders to Withhold Their Votes OUR WITHHOLD VOTE CAMPAIGN ALLOWS CF STOCKHOLDERS TO RESTORE THEIR VOICE AND URGE THAT THE CF BOARD AND MANAGEMENT ENGAGE IN DISCUSSIONS WITH US |
 Fundamentals of Growth 9 Transaction Overview |
 Fundamentals of Growth 10 Transaction Highlights • Compelling value for CF stockholders – Attractive premium – Flexibility to elect desired form of consideration (subject to proration) • Strong strategic fit – Continues Agrium’s growth and diversification across the value chain – Complementary wholesale production and distribution – Creates leading global nitrogen producer – Creates leading North American phosphate producer • Significant synergy realization opportunity • Strong record of growth and successful integration of acquisitions • Increased scale and preservation of balance sheet strength |
 Fundamentals of Growth 11 30 40 50 60 70 $80 02-Jan-09 29-Jan-09 25-Feb-09 27-Mar-09 Attractive Premium to CF Stockholders 48% $50.60 30 day VWAP 48% $50.47 60 day VWAP 40% $53.63 10 day VWAP 35% $55.58 Feb 24, 2009 39% $53.75 5 day VWAP Premium (1) (1) Based on value of mixed consideration and Agrium share price as of March 26 (2) Based on value of mixed consideration and Agrium share price as of February 24
• Spread between Agrium’s offer and CF’s share price has averaged 1.5% since announcement – Investors supportive of Agrium/CF combination – Market indicates transaction is likely to be consummated • In contrast, CF’s quoted value of offers for Terra and resultant premiums are
illusory, given CF’s share price is supported by Agrium’s offer $72.00 Initial Offer $74.90 Revised Offer Initial Agrium Offer Revised Agrium Offer (1) (2) |
 Fundamentals of Growth 12 Offer Provides Flexibility to CF Stockholders • Over 50% of the consideration being offered for CF is in the form of stock – Agrium’s offer presents CF stockholders with a unique opportunity for significant
long-term value while providing liquidity for those wishing to sell
their CF shares at an extremely attractive price – CF stockholders will have the opportunity to participate in further upside in
fertilizer stocks, through Agrium share ownership and to participate in the
realization of significant synergies associated with the combination – Allows CF stockholders the ability to elect which form of consideration they
would prefer to receive (subject to proration) • CF stockholders will benefit from holding shares in a company with a more diverse product and revenue mix – Over a 5-year time frame (not just two peak years for commodity prices as
presented by CF), Agrium has higher average gross margins than CF, with
substantially less volatility in such margins |
 Fundamentals of Growth 13 Continues Agrium’s Growth Across the Value Chain * 2008 actual results include UAP contributions from date of acquisition (May 5,
2008) Distribution & Storage Growers Agrium Retail: $5.5 billion sales* Advanced Technologies: Leader in Specialty Fertilizers $350 million sales Growers Turf, Home, Garden Agrium Wholesale: $4.7 billion sales Nitrogen, Potash, Phosphate & Sulphate Distribution & Storage Industrial Customers Retail Customers Purchase for Resale Potash expansion CMF distribution MOPCO investment Royster, ConAgra, ADM retail, and UAP Hanfeng, Pursell, NuGro, ESN CF Acquisition |
 Fundamentals of Growth 14 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 Agrium 2005 Agrium 2008 Combined Agrium/CF Continues Agrium’s Growth Across the Value Chain 2008 EBITDA: $2.3 billion Combined EBITDA: $3.7 billion * Agrium amounts reported in Canadian GAAP, and CF amounts reported in U.S.
GAAP, EBITDA for Wholesale products
allocated proportionately based on gross profit 2005 EBITDA: $646 million • CF stockholders benefit from greater leverage to a larger more diverse wholesale business, including access to high margin potash business • Provides CF with the stability of Agrium’s Retail and Advanced Technology businesses Synergies Phosphate CF Nitrogen CF Phosphate Agrium Nitrogen Agrium Potash Agrium AAT & Other Retail |
 Fundamentals of Growth 15 Complementary Production and Distribution Potash Production Phosphate Mine Phosphate Production Nitrogen Production Granulation Production Storage Magellan Pipeline Phosphate Mine Phosphate Production Nitrogen Production Storage Valero Pipeline South America Africa/Middle East North America Damietta Egypt (MOPCO)** Bahia Blanca, Argentina (Profertil S.A.) * San Nicolas Import Terminal (Profertil S.A.)* Agrium CF Europe Common Market Fertilizers S.A. (CMF)*** * Profertil S.A. is 50 percent owned by Agrium Inc. and 50 percent owned by Repsol YPF,
S.A. in Argentina ** 26 percent interest in MISR Oil Processing Company,
S.A.E. (MOPCO) in Egypt. *** 70 percent equity position in Common
Market Fertilizers S.A. (CMF) in Europe. |
 Fundamentals of Growth 16 Creates a Global Nitrogen Leader 6.7 6.4 3.4 3.4 3.4 3.0 2.3 0.0 1.0 2.0 3.0 4.0 5.0 6.0 7.0 8.0 Yara Combined Agrium/CF PCS Terra Agrium CF Koch Global Nitrogen Capacity Source: British Sulphur and IFDC |
 Fundamentals of Growth 17 Phosphate Advantages 4,307 2,370 1,673 953 775 720 376 0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000 Mosaic PCS Combined Agrium/CF CF J.R. Simplot Co. Agrium Mississippi Phos Corp. North American Phosphate Nutrient Capacity Source: IFDC Worldwide Phosphoric Acid Capacity Listing by Plant, June 2008
|
 Fundamentals of Growth 18 Synergy Opportunities • Anticipate annual synergies of approximately $150 million from Agrium/CF combination – Phased realization over three years • Synergies expected through – SG&A reductions – Procurement of plant materials, equipment and logistics services – Efficiencies in sales, marketing and distribution • Expected to be accretive to both earnings and cash flow in 2010, significantly accretive in subsequent years |
 Fundamentals of Growth 19 Strong Record of Growth and Successful Integration of Acquisitions (1) 2008 Combined results include full year revenue for AGU and UAP by segment
0 3,000 6,000 9,000 12,000 15,000 18,000 AGU CF AGU with Royster CF AGU CF AGU with UAP CF AGU with UAP and CF CF 2005 2006 2007 Wholesale AAT Retail 2008 Combined 2008 (1) (1) • Agrium has invested $3.4 billion in acquisitions over the past five years and achieved synergies greater than announced and earlier than expected • Agrium has completed nine acquisitions and several growth initiatives across the value chain in the past five years • In contrast, CF has announced a single acquisition of approximately $25 million and has no track record of integrating acquisitions and realizing synergies |
 Fundamentals of Growth 20 Strength, Breadth and Scale to Realize Future Growth • Larger company with significantly greater trading liquidity • Agrium has trading volumes nearly double those of CF (1) (1) Based on total volume traded on the NYSE and TSX over the last twelve months (2) Enterprise value = market capitalization + preferred equity + net debt + minority
interest. Values calculated using closing prices as of April 3, 2009, and latest available balance sheet figures (3) Enterprise value includes purchase premium offered for CF shares 28.8 19.0 12.3 10.5 5.3 3.4 2.3 1.4 9.0 11.4 8.3 3.1 0 5 10 15 20 25 $30 Potash Corp Mosaic Israel Chemicals Combined Agrium / CF Yara K+S Agrium Uralkali Incitec Pivot CF Terra Intrepid (3) |
 Fundamentals of Growth 21 Combined Capital Structure Remains Strong • Cash consideration supported by $1.4 billion in committed financing • Credit metrics for combined company remain in line with investment grade rating • Expected strong future cash flow from combined entity would allow for future additional growth and/or share buy-backs or increased dividends Current Agrium (1) Combined Agrium/CF (1,2) Total Debt 36% Shareholder Equity 61% Minority Interest 3% 0% 20% 40% 60% 80% 100% Current Agrium Total Debt 36% Shareholder Equity 61% Minority Interest 3% 0% 20% 40% 60% 80% 100% Combined Agrium/CF (1) Based on December 31, 2008 balance sheet (2) Based on revised exchange offer, value of consideration as at March 26, 2009
|
 Fundamentals of Growth 22 Most Attractive Option for CF Stockholders • CF stockholders receive an attractive premium from Agrium, rather than pay a premium to Terra stockholders • Attractive cash component of $35.00 per share and 24 percent of a combined Agrium/CF company • Significant Agrium share component allows CF stockholders an opportunity to participate in further value creation, including realization of significant synergies • Benefit from more diverse product and revenue mix |