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Potash Corp evaluating SQM, ICL stakes; other holdings 'strategic'

Reuters
Jochen Tilk, who takes over as Potash Corp's chief executive officer in July, attends the company's annual general meeting in Saskatoon, May 15, 2014. REUTERS/Derek Mortensen

By Rod Nickel

NEW YORK (Reuters) - Potash Corporation of Saskatchewan Inc (Toronto:POT.TO - News) Chief Executive Jochen Tilk said on Thursday that he views the company’s stakes in fertilizer companies Sinofert Holdings (HKSE:0297.HK - News) and Arab Potash Company (:APOT.AM) as “strategic,” but continues to review whether to keep its shares in ICL (Tel Aviv:ICL.TA - News) and SQM (SQMa.SN).

Tilk, speaking at a BMO (Toronto:BMO.TO - News) investor conference in New York, said if Potash Corp could not build on its SQM and ICL minority stakes, it will consider whether it should keep them.

Potash Corp has control over how Jordan's Arab Potash Company markets its potash, and Tilk said the Sinofert stake gives Potash a window into the Chinese market.

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But the company does not have as much influence as it wants over SQM and ICL.

Tilk said in an interview that he has not spoken with Israeli Prime Minister Benjamin Netanyahu about whether he would permit a foreign company to take control of ICL, in which the government holds a golden share.

Potash Corp tried under former Chief Executive Bill Doyle to gain a majority stake in ICL, but ran into strong opposition and backed off in 2013.

Tilk, who took the Potash Corp helm last July, announced a review in December of the company's four major equity stakes, which at the time were worth $4.5 billion.

He said on Thursday he did not want to signal any plans for SQM and ICL investments.

"We can't be counter-productive by doing or acting (to) impair the value of the companies. Timing is everything."

ICL Chief Executive Stefan Borgas said in an interview that if Potash Corp wants to increase its stake, it should be direct with Israel's government and ICL's biggest shareholder, Israel Corp (Tel Aviv:ILCO.TA - News).

"Our advice would always be for anybody who has these kind of interests, not just in ICL, but in general, is be as specific as you possibly can so there is actually a concrete proposal on the table, rather than just discussing concepts," he said on Wednesday.

Borgas said many investors have approached ICL about interest in Potash Corp's stake.

Potash Corp recently bought a 9.5 percent stake in Brazilian fertilizer distributor Heringer SA, but Tilk said he does not see the same need for control as in the company's other equity investments.

(Editing by Marguerita Choy)