Lyle SteinPotashCorpPOT.TOCOMMENTDec 30, 2015

The merger with Agrium (AGU-T) has been approved. She owns Agrium and likes the merger/acquisition. Just did an Australian acquisition to expand their presence there. Going forward, this is where they are going to focus on a lot of their growth.

They are merging with AGU-T. There will be $500 Million in synergies. It is the bottom of the cycle for crop nutrients. (Analysts’ target: $24.46).

This has been depressed and in a narrow range during 2016-2017. A lot of people were long in 2013-2015. We are beginning to digest the overhead supply, but he would like to see better price action first. Right now, he is neutral at best.

He doesn't cover this, but does cover Agrium (AGU-T). Thinks the combined entity will bear fruit for shareholders. This is a market that is fairly depressed and will probably turn up over the next several years. It gives you the cost cutting that will create some shareholder value.

He is warming up to agriculture a little. With the merger, this will be the “go to” name in the sector. It is a good fit. He is seeing a bit of a bottom in commodity prices. You are not going to get hurt by owning either Potash (POT-T) or Agrium (AGU-T) right now.

This whole industry needs consolidation. They are going through the strong and painful process of consolidation, and it is going to take time. Eventually this should work. He wouldn’t be in a rush to buy this.

The acquisition has been delayed. They are picking a new name. They will have to sell some assets. Canadian and Chinese regulatory authorities have approved the acquisition. It will likely close in late Q4 this year. There will be a lack of competition in the potash industry. There is a lot of supply coming on in it.

POT-T & AGU-T. AGU-T was a buy and hold when he was last on. It has been kind of bouncing around. He has always liked the retail part. Also, it is global. The Texan floods could impact AGU-T with a psychological effect on investors. POT-T is starting to perk up in the US and they signed a Chinese contract. He would not sell out just because of the merger.

POT-T and AGU-T amalgamation. Mid-October is the expected merger date. He thinks it is a positive to have them together. These are such big companies that the market has discounted synergies. You will get a lower yield on POT-T after the merger which some may not like. He sees it net sideways from here. He does not like the fertilizer outlook from here. He would rather miss the first 5-10% to see if it trends up.

He was worried about the fertilizer outlook a year ago. He preferred AGU-T because they were partly retail. In a merger you have one vehicle, but a mishmash of lower dividend and more cyclicality. He does not feel any urgency to come back to the sector.

Thinks it has sort of bottomed here and is heading up, with a little more of a bullish outlook. Supply/demand has been a little bit out of whack for a number of years, but thinks things are tightening up. He likes the merger with Agrium (AGU-T).

They are awaiting regulatory approvals on a merger with AGU-T. It is premature to make a judgment as to whether the two companies will see a lot of synergies. It is better to be prudent and not put your chips into it at this time. Wait for the consummation.

About a year ago, Agrium (AGU-T) made an offer to merge. The reason they wanted to merge is to be able to get Potash’s nitrogen business merging with Agrium’s retail business and their nutrients, which will give them the ability to get better prices. Those that own the Potash shares are going to get a pretty good deal, because they are getting strong free cash flow from Agrium. Both stocks have struggled this year because nutrient prices are down.

Thinks the time has passed to get into this. As an ex-Agrium shareholder, he was disappointed on hearing of the merger. With the merger, this is going to blend the companies, and thinks they are going to be more potash weighted. Any of the benefits of this merger are already in the 2 stocks.

(A Top Pick June 16/16. Up 5%.) He sold this when he felt the market was overestimating the price people were going to pay for potash.