Canada's Potash Corp of Saskatchewan Inc. remains focused on acquiring German salt and fertilizer company K+S, the company said on Thursday, and is prepared to make "binding commitments" to maintain jobs and keep mines running in Germany to get a deal.
If it acquires K+S, Potash Corp, the world's biggest fertilizer producer, would finish building K+S's Saskatchewan mine and operate it, selling its potash offshore through its Canpotex marketing arm, Chief Executive Jochen Tilk said during a conference call. Canpotex is a partnership with Mosaic Co MOS.N and Agrium Inc AGU.TO.
"This combination would create a more efficient, integrated company able to prosper in an increasingly competitive global marketplace with expanding global capacity," Tilk said.
Potash Corp said it intends to talk with K+S management, despite K+S's rejection this month of Potash Corp's 7.9 billion euro ($8.65 billion) bid of 41 euros per share as too low.
K+S has suggested Potash plans to shrink the company. Analysts have speculated that Potash wants to acquire K+S, a higher-cost producer, to shut some production to support prices.
Potash Corp stock edged up 0.7 percent to $27.03 in New York, paring earlier gains, after hitting a 52-week low on Wednesday.
The company reduced the top end of its full-year earnings forecast on Thursday and reported a 12 percent drop in quarterly profit, missing Wall Street's estimate, mainly due to weak nitrogen earnings and lower phosphate sales.
The top end of the full-year profit forecast is now $1.95 per share, down from $2.05. The low end is unchanged at $1.75.
Analysts, on average, had expected earnings of $1.86 per share, near the midpoint of Potash's revised guidance, according to Thomson Reuters I/B/E/S.
For the third quarter, Potash expects to earn 35 to 45 cents per share. Analysts had expected 43 cents.
Net income fell to $417 million, or 50 cents per share, in the second quarter, from $472 million, or 56 cents, a year earlier.
That was below the average estimate of 51 cents.
Revenue fell 8.5 percent to $1.73 billion, below analysts' estimate of $1.89 billion.
Increased global supply and record Chinese urea exports weakened nitrogen prices, the company said.
Potash Corp's potash production was flat at 2.5 million tonnes, while the average realized price rose 4 percent to $273 per tonne.
The company narrowed its 2015 potash sales forecast to 9.3 million to 9.6 million tonnes from 9.2 million to 9.7 million.