Following two months of vocal opposition from Israeli politicians, Canada’s
Potash Corp. on Thursday dropped efforts to acquire Israel Chemicals (ICL), the
country’s second-largest publicly traded company.
“Over recent months, we
have been exploring the possibility of expanding our ownership interests in
While we continue to believe that such a transaction would be of
tremendous benefit to stakeholders of both companies and the State of Israel,
there must be receptivity to foreign investment and certainty in the rules that
govern such investment,” the company wrote in its first quarter statement,
“We have therefore concluded that now is not the time
to pursue this opportunity and will focus our energies on other options to
maximize shareholder value.”
In response to the announcement, Israel
Chemicals said that it had never entered formal negotiations with Potash over a
“No actor turned to ICL with a merger proposal and ICL was not
involved in any discussions about it,” the company said.
partnerships with major players such as Canada’s Potash are an appropriate
alternative, but certainly not the only alternative for ICL’s growth,” it
Had Potash, which already owns a 14 percent stake in Israel
Chemicals, come to control the company, it would have become the world’s largest
Israel Chemicals stock dropped 4% on the
Earlier in the month, Finance Minister Yair Lapid came out
against the deal
, saying, “Israel’s natural resources are a public asset, and
the Israeli public should be the first to benefit from them.”
occasions, Lapid has stated that helping the public reap the benefits of
Israel’s natural resources is a priority for him, hinting that he may reexamine
taxation policy on resources such as potash.
Lapid’s predecessor Yuval
Steinitz had also supported the possibility that the government would nix the
deal, saying, “The State of Israel, which has a golden share [of potash],
doesn’t need to agree to a deal that might endanger or harm the Israeli
In February, politicians called an emergency Knesset meeting to
head off the possibility of a merger or acquisition.
They cited fears
that the foreign company, which also owns operations in Jordan, would simply
move its activities out of Israel and across the border, taking thousands of
jobs with it.
At the time, Yesh Atid MK Meir Cohen called the potential
sale “a slap in the face” to the entire Negev, where the company employs
approximately 5,000 workers, accounting for a fifth of the region’s output.