Nutrien will buy out its SQM shares next Monday and mark the end of the era

The biggest business in recent years in the local market has the day and time to realize.

Yesterday at noon, Canadian Nutrien (a subsidiary of Potash Corp) registered an auction of more than 62 million S-series S shares in the Santiago Stock Exchange, representing almost 24% of its ownership. And she announced the operation on Monday, December 3 at 9:15 pm, which will take place in the circular room of the main stock exchange in the country.

This package must be won by China's Tianqi, which will become a milestone: after 15 years, Nutrien will leave SQM's estate, appointing its members as members of the board of directors, and taking part in the decision-making process of the company, and joining the Asian company.

The transaction, which will be run by Banchile Corredores de Bolsa, will have a minimum price of $ 65 per share, so the expected amount will be $ 4,066 million.

So if it is not a surprise, this operation, which was marked by controversy, is closed.

Matching program

After the TDLC approved an agreement between the FNE and Tianqi at the beginning of October on the entry of this property into SQM, a new hearing was opened.

According to the PULSO publication published in October, this is a proposal from China and Chile, which concerns the so-called Compliance Program, which consists of a protocol of agreement that Tianqi has agreed with the FNE and which seeks to limit the risk of illegal coordination between directors. both companies.

One of the most important details to be protected concerns the possible illicit exchange of information on the lithium market where both companies are the largest players in the world.

Let's say the resources that are aware of this process are ready for next year: in April 2019 they will take over three directors named Tianqi in the SQM, with the Chinese having a deadline of 60 calendar days to submit their proposal to the board of directors of the Chilean mining company.

This process qualifies experts as "crucial" and even more important than TDLC decisions. It should be noted that this new step is primarily addressed at the level of lawyers specializing in free competition and corporate law.

In this context, the Pampa Group, representing the interests of Julius Ponce, who controls SQM through cascading companies, could push in this way to improve – from his point of view – the terms of the agreement that allowed Tianqi to enter the SQM.

Battle history

In May of this year, an agreement was announced between Nutrien and Tianqi to purchase this company's participation in SQM.

The following month, the FNE announced the initiation of the investigation with the aim of evaluating the possible effects on competition that the operation might bring. This, based on complaints filed by Corfo and Senator Alejandro Guillero.

In this way, the transaction was frozen during the extension of the investigation. Together at the end of August, the FNE announced that it had reached an agreement with Tianqi, where it concluded various risk mitigation measures that could trigger free competition operations.

Measures include that Tianqi will not elect directors, executives or employees of its company to become part of the SQM Board and that neither the Chinese company nor its directors will be able to influence or interfere in favor of Tianqi or to the detriment of the company's interests. Chilean mining.

The agreement was then concluded with the TDLC to agree. In the middle of that, charges were filed in September when the Pampa Group disagreed with the deal.

Despite that, the TDLC approved the agreement in early October, after which the Pampa group returned to the charge, but their attempts were again frustrated.

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