Cf Industries Holdings, Inc. · NYSE:CF
Cf Industries — Proxy Contest (April 2009)
23 slides from Cf Industries's proxy contest presentation, Apr 14, 2009
Slide 1: Schedule 14A Cover Page
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 14A Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934 (Amendment No. ) Filed by the Registrant ¨ Filed by a Party other than the Registrant x Check the appropriate box: ¨ Preliminary Proxy
Slide 2: Agrium and CF: Growing Across the Value Chain
Fundamentals of Growth Agrium and CF: Growing Across the Value Chain April 2009
Slide 3: Important Information
Important Information This presentation does not constitute an offer to exchange, or a solicitation of an offer to exchange, common stock of CF Industries Holdings, Inc. (“CF”), nor is it a substitute for the Tender Offer Statement on Schedule TO or the Prospectus/Offer to Exchange included in the R
Slide 4: Forward-Looking Statements
Forward-Looking Statements Certain statements and other information included in this presentation constitute “forward-looking information” within the meaning of applicable Canadian securities legislation or “forward-looking statements” (together, “forward-looking statements”). All statements in this
Slide 5: Presentation Messages
Presentation Messages • We are offering significant value to CF stockholders and creating value for Agrium • We are determined to acquire CF and we are prepared to consider increasing our bid if CF would only engage with us • We need your help to send a strong message to CF's Board and management to
Slide 6: Withhold Vote Campaign
Withhold Vote Campaign Fundamentals of Growth 5
Slide 7: We Believe CF is Ignoring Interests of its Stockholders
We Believe CF is Ignoring Interests of its Stockholders • CF restructured its offer for Terra for the sole purpose of eliminating a CF stockholder vote on the Terra deal – CF exercised its discretion to do an end-run around its stockholders and has taken away their vote – We believe this highlights
Slide 8: We Urge CF Stockholders to Withhold Their Votes
We Urge CF Stockholders to Withhold Their Votes • Three CF directors standing for re-election at CF’s annual meeting on April 21 • Agrium filed a definitive proxy on April 6 with the SEC and is actively soliciting proxies from CF stockholders to withhold their votes on election of CF directors • Sig
Slide 9: Transaction Highlights
Transaction Highlights We believe our transaction offers the following: • Compelling value for CF stockholders – Significant premium – Flexibility to elect desired form of consideration (subject to proration) • Strong strategic fit – Continues Agrium’s growth and diversification across the value cha
Slide 10: Significant Premium to CF Stockholders
Significant Premium to CF Stockholders $80 $74.90 Revised Offer (1) Premium (1) 70 $72.00 Initial Offer (2) Feb 24, 2009 $55.58 35% 60 5 day VWAP $53.75 39% 10 day VWAP $53.63 40% 50 Initial Revised 30 day VWAP $50.60 48% 40 Agrium Agrium 60 day VWAP $50.47 48% Offer Offer 30 02-Jan-09 29-Jan-09 25-
Slide 11: Significant Premium to CF Stockholders
Significant Premium to CF Stockholders • CF stock has traded up significantly due to Agrium’s offer – Minimal impact from Terra offer – CF performed in line with peers post-announcement • Trading 39% over the fertilizer peers since date of Terra Offer (Jan. 15) 160% CF Actual: +55%; $73.03 140% Glob
Slide 12: Compelling Valuation
Compelling Valuation • CF says that their offer for Terra is “full and fair value” (1) and at the same time claims Agrium’s offer is “grossly inadequate” • Yet, Agrium is offering a 39% greater multiple for CF than CF is offering for Terra – 4.6x vs. 3.3x 2010E EBITDA(2) using CF’s unaffected share
Slide 13: Offer Provides Flexibility to CF Stockholders
Offer Provides Flexibility to CF Stockholders • Over 50% of the consideration being offered for CF is in the form of stock – Agrium’s offer presents CF stockholders with a unique opportunity for significant long-term value while providing liquidity for those wishing to sell their CF shares at an att
Slide 14: Continues Agrium's Growth Across the Value Chain
Continues Agrium’s Growth Across the Value Chain • CF stockholders benefit from greater leverage to a larger more diverse wholesale business, including access to high margin potash business • Provides CF with the stability of Agrium’s Retail and Advanced Technology businesses Combined EBITDA: 4,000
Slide 15: Broader more Stable Cash Flows and Growth
Broader more Stable Cash Flows and Growth • Agrium has historically traded at a premium multiple to CF due to our superior product and business mix – Average 8.8x for Agrium vs. 5.7x for CF (LTM EV/EBITDA) since CF’s IPO in Aug. 2005(1) – Industry analysts give Agrium’s Retail, Potash and Advanced T
Slide 16: Agrium's Superior Wholesale Margins
Agrium’s Superior Wholesale Margins • Agrium has consistently achieved higher Wholesale margins than CF partly due to better quality assets and asset mix – Agrium’s average nitrogen and phosphate margins are significantly higher than CF’s – Agrium’s total average margins are 11 percent higher than C
Slide 17: Urea and DAP Prices Reached Record Levels in 2008
Urea and DAP Prices Reached Record Levels in 2008 • CF’s reliance on short-lived peak 2008 nitrogen and phosphate prices for current and future valuations are unrealistic and irrelevant • Current nitrogen and phosphate prices are NOT at the bottom of the cycle $1,400 Urea Current 10yr Average $1,200
Slide 18: Synergy Opportunities
Synergy Opportunities • Anticipate annual synergies of approximately $150 million from Agrium/CF combination – Phased realization over three years • Synergies expected through – SG&A reductions – Procurement of plant materials, equipment and logistics services – Efficiencies in sales, marketing and
Slide 19: Strong Record of Growth and Successful Integration of Acquisitions
Strong Record of Growth and Successful Integration of Acquisitions • Agrium has invested $3.4 billion in 9 acquisitions over the past five years and achieved synergies greater than announced • Agrium has completed 17 acquisitions and growth initiatives in the past 16 years • In contrast, CF has anno
Slide 20: Agrium is Committed to Acquiring CF
Agrium is Committed to Acquiring CF • CF continues to ignore our repeated offers to engage with us, despite our willingness to consider further increases in our bid – Offer for CF made within 24 hours of securing the $1.4 billion of financing • Significant costs incurred to date by Agrium – Bank com
Slide 21: Agrium and CF: Growing Across the Value Chain
Fundamentals of Growth Agrium and CF: Growing Across the Value Chain April 2009
Slide 22: Background
Background Week CF / Terra Agrium / CF • CF announces proposal to acquire Terra (1/15) Jan 11 – 100% stock transaction, $20.00/share – Transaction subject to CF stockholder vote under NYSE rules • CF files exchange offer to acquire Terra (2/23) • Agrium announces proposal to acquire CF (2/25) Feb 22
Slide 23: Compelling Valuation
Compelling Valuation • CF says that their offer for Terra is “full and fair value” (1) and at the same time claims Agrium’s offer is “grossly inadequate” • Yet, Agrium is offering a 39% greater multiple for CF than CF is offering for Terra – 4.6x vs. 3.3x 2010E EBITDA (2) using CF’s unaffected share