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It’s Alberta versus Saskatchewan in a race to host a giant company that could emerge from a merger between Agrium and PotashCorp, and a Canadian business expert says that’s likely just how both companies’ boards want it.
Dr. Sylvain Charlebois is the dean of Dalhousie University’s faculty of management.
He also serves as a professor of food distribution and policy in the school’s agriculture department.
During an appearance on Gormley, Charlebois said the way the story of merger talks broke Tuesday seems to have played to the advantage of the companies, as officials from both Saskatchewan and Alberta quickly began pushing for the head office of what would be a $30 billion firm.
“What’s really brilliant as far as I’m concerned is to see two boards coming out with this teaser through Bloomberg (Tuesday) and now you have two governments going at it (Wednesday) morning,” Charlebois said.
A Bloomberg News story quoting unnamed sources came out Tuesday morning saying talks were being held.
The companies later confirmed they were holding negotiations in a pair of near-identical press releases.
With PotashCorp headquartered in Saskatoon and Agrium’s head office in Calgary, Saskatchewan Premier Brad Wall said he had already contacted the head of PotashCorp to press the case for having the head office of any newly-formed company in Saskatchewan.
Meanwhile, an Aug. 30 article in the Calgary Herald quoted Alberta Minister of Economic Development and Trade, Deron Bilous, saying he’d been in contact with Agrium to push for Calgary as the best home for any new company created in a merger.
While the companies billed any potential deal as a ‘merger of equals’ Charlebois said most deals tend to see one company’s culture take over, which could bode well for Saskatchewan’s efforts to keep the headquarters here.
“(PotashCorp) is a larger company with a rich history, so naturally I would (expect to) see PotashCorp take the lead on this,” he said, adding that PotashCorp swallowing Agrium is likely the more politically palatable scenario.
Currently, Agrium and PotashCorp employ a total of just over 20,000 people worldwide.
If they were to merge, the resulting company would be the world’s largest potash producer by capacity, as well as the world’s largest agricultural retailer.