TORONTO/CHICAGO (Reuters) – Fertilizer maker Agrium Inc. may have failed to clinch a deal to acquire U.S. rival CF Industries, but it continues to look to expand its North American retail business, chief executive officer Michael Wilson said.
“We have a mapping of North America and we just look at where we are not and we look at going there,” Wilson said. “We have a little over 800 farm centres. We picked up about 60 last year and I am hoping that we will pick up another 50 to 60 this year. And you will see us continue to do this over the next four, five, six years.”
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Wilson, who has steered Agrium for more than six years, has transformed the company from a producer of mainly nitrogen-based fertilizers into the largest North American agricultural products retailer.
Agrium’s retail network in North America is roughly three times larger than the second-largest player in the region and its retail unit boasted sales of more than $6 billion in 2009.
However, it still commands only a 15 percent market share in the region which the company hopes to double over time.
Wilson said joint ventures will be Agrium’s main vehicle of growth in overseas markets.
“When you are going into Asia, or some parts of Europe, certainly in South America too, it is good to have a local partner,” he said.
Agrium already has a series of equity stakes in foreign companies including its stake in Mopco in Egypt, Common Market Fertilizers in Europe and Hanfeng Evergreen in China.
“We are looking for partnerships on our polymer coated products,” said Wilson.
Agrium’s polymer coated product is part of a series of controlled-release fertilizers that are used on golf courses and in other niche markets.
Agrium already has a partnership with Hanfeng to produce and market sulfur coated urea.
Calgary-based Agrium cancelled its bid for CF Industries earlier this month after CF set a $4.7 billion US deal to buy Terra Industries. Agrium had said it would not buy CF if CF went ahead and acquired Terra.
Wilson said withdrawing the CF bid was not a hard decision, as CF did not seem inclined to negotiate and the company’s expectations were too high.
“It wasn’t hard (to walk away) because it wasn’t the right decision. We could have bumped our bid a little bit, to be quite honest, but to the degree it would have taken to get them to come to the table … we didn’t think it was worth it to our shareholders.”
