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Potash seeks 'white knight' to avert takeover by Billiton

Potash corporation of Saskatchewan has reasserted its opposition to BHP Billiton's $38.5bn takeover bid, insisting that other companies are waiting to make a counter offer.

The group's chief executive, Bill Doyle said that "all sorts of different players" have contacted the PotashCorp a week after the company rejected BHP's $130-a-share offer. He also accused the world's biggest mining company of trying to "steal" the Toronto-based fertiliser business.

Mr Doyle is expected to make about $445m from the deal, thanks to a number of options.

Despite Mr Doyle's comments, a spokesman declined to say which companies had entered discussions. The huge Chinese state-owned chemicals company, Sinochem, said last week that it would pay "close attention" to developments with BHP's now hostile approach.

A spokesman for the Chinese group, Li Qiang, said last Friday that Sinochem was "interested in overseas potash investment opportunities" and already had a close relationship with the Canadian business.

The Brazilian mining giant Vale is also understood to have expressed preliminary interest in PotashCorp, and would be keen to prevent rival BHP getting a foothold of as much as 20% in the lucrative potash market.

PotashCorp says that it is confident that it can remain as an independent company, but with its shares now trading above $150, significantly above BHP's bid level, the market clearly believes that the company is in play.

Relations between PotashCorp and the Anglo-Australian BHP are already strained, as the mining group starts its charm offence with the Canadian group's shareholders. Bankers from Goldman Sachs, RBC Capital Markets and Bank of America have been in meetings trying to find a white knight to launch a counterbid.

"Discussions are being pursued with several of these third parties in order to generate value-enhancing alternatives," said PotashCorp.

A takeover by BHP Billiton remains the most likely outcome, however, even if the group is eventually forced to increase its bid.