Potash Corp. of Saskatchewan (PotashCorp) announced on October 4 that it had withdrawn its proposal to negotiate an acquisition of rival potash producer K+S AG of Germany. PotashCorp had announced its proposal to acquire K+S at a price of €41 per share in late June. The proposal valued K+S at about $8.7 billion.

K+S management and its board of directors declined to negotiate with PotashCorp, saying the proposal did not reflect the fundamental value of the company.

PotashCorp disagreed. “Our proposal reflected full and fair value and was predicated on a collaborative process with access to customary due diligence,” PotashCorp President and CEO Jochen Tilk said. “Since that time, challenging macroeconomic conditions have contributed to a significant decline of global commodity and equity markets, with potash peer stocks down almost 40%. In light of these market conditions, and a lack of engagement by K+S management, we have concluded that continued pursuit of a combination is no longer in the best interests of our shareholders.”

PotashCorp is headquartered in Saskatoon, Saskatchewan, and is the world’s largest integrated fertilizer and related industrial and feed products company by capacity. It is the world’s largest producer of potash and one of the largest producers of nitrogen and phosphate.

K+S is a major producer of potash from mines in Germany and is the world’s largest producer of salt, with mines in Europe, South America and North America. The company is developing its Legacy solution mining potash project 50 km north of Moose Jaw, Saskatchewan, with commissioning scheduled for the summer of 2016.

PotashCorp had maintained that its proposal to acquire K+S was not predicated on closing mines, curtailing production, selling the salt business or cutting jobs. K+S remained unconvinced.