Fertilizer maker CF Industries, OCI end merger deal

OCI’s Iowa nitrogen plant, shown here under construction in 2015. (OCI.nl)

Reuters — U.S. fertilizer maker CF Industries Holdings Inc and Dutch rival OCI NV ended their merger agreement on Monday, following the U.S. Treasury’s steps to curb tax avoiding inversion deals.

CF Industries had agreed to buy OCI NV’s North American and European plants for US$6 billion in August, in addition to assuming US$2 billion of OCI’s debt, to create the world’s largest publicly traded nitrogen company.

“…changes in the regulatory and commercial environments forced us to re-evaluate the combination,” CF CEO Tony Will said in a statement.

CF will pay OCI a termination fee of US$150 million related to the deal.

In April, the U.S. Treasury Department and Internal Revenue Service announced new steps to curb “inversion” deals that U.S. companies do with foreign corporations, including earnings stripping.

The latest steps impose a three-year limit on foreign companies bulking up on U.S. assets to avoid ownership requirements for a later inversions deal.

Reporting for Reuters by Abinaya Vijayaraghavan in Bangalore.



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