no that was a different deal.........
it was a cash payment from the CHS deal.....
i believe technically...... they (CHS) bought into a sub company "CF NITROGEN" rather than building their own competing facilities as previously planned. CHS decided not to build a 1.8-3.8 billion dollar north dakota facility and instead made this deal.
CF makes payments to CHS for their investment in CF NITROGEN........ based upon profit of that division.....
According to the deal terms...... CF is obliged to supply CHS and its farmer group around 2 million tons a year of Nitrogen related fertilizer products AT MARKET PRICES ...FOR A TERM OF EIGHTY YEARS
this is my understanding.... if anyone has a criticism..... have at it
I didn't see your post before posting mine! My bad!
My point was mainly that THIS WAS A DIFFERENT DEAL than the cancelled OCI deal.
I agree with your suggestion that the company should buyback as much of their float as possible...... while maintaining investment grade status on their outstanding debt deals.
If you listen to the explanation that the company gave regarding the cancellation of the OCI deal, at the end of the Q&A Tony Will clearly confirms the company's desire to do more buybacks. He stated that the currently approved buybacks had 100 million left in it. He also stated that the board would re-examine the appropriateness of buybacks (which if past performance is any indication) which should be aggressive. He clearly stated that CF would not complete the OCI deal BECAUSE of the INVERSION CLAMPDOWN as WELL AS THE LOWER CF SHARE PRICE which would have been punitive to cf shareholders had the transaction been completed.
If they think the CF share price is too low to do the conversion.........then I would assume they recognize the EXTREME VALUE that the shares present for buybacks and will act aggressively.!
Furthermore, Tony Will had previously said that buybacks were on hold while the OCI deal was pending. Now that the deal is off.......... THEY CAN BUY AT WILL. It really is a matter of how much of their 2.7 billion they feel comfortable spending. I could see easily a 1.5 billion allocation to buybacks........should leave them enough room to breathe......while retiring 25% of the outstanding shares.
They also have access to a 2 billion dollar line of credit........ so.........that may inspire them to get even more aggressive.
Just my somewhat humble opinion!
47.36 / 23.75 =1.994105263157895
Yu could have made 99%......
don't say we didn't try to talk some sense into and help yu!