Agrium Inc. and Potash Corporation of Saskatchewan Inc. (PotashCorp) announced today that they are merging to create one of the world’s largest global suppliers of crop inputs. Following the close of the transaction, PotashCorp shareholders will own approximately 52% of the new company, and Agrium shareholders will own approximately 48% on a fully diluted basis.

The new company, to be named prior to the transaction’s closing, will combine the nitrogen and phosphate production assets into a premier agricultural retail network to forge an integrated crop inputs platform. The new company will be a leader in the fertilizer industry with close to 20,000 employees, operations and investments in 18 countries and a pro forma enterprise value of $36 billion, based on each company’s net debt as of June 30, 2016, and the current shares outstanding and respective closing share prices of the companies on the New York Stock Exchange on Aug. 29, 2016. On a 2015 pro forma basis, the new company would have had net revenue of approximately $20.6 billion and earnings before interest, taxes, depreciation and amortization of $4.7 billion before synergies.

“Our merger creates a new premier Canadian-headquartered company that reflects our shared commitment to creating value and unlocking growth potential for shareholders,” PotashCorp president and chief executive officer Jochen Tilk said. “The integrated platform established through our combination will greatly benefit customers and suppliers and support even greater career development opportunities for employees. Our workforce and the communities in which we operate are critical to both PotashCorp and Agrium, and we intend to carry forward best practices from both companies in corporate social responsibility, including commitments to employees, operating communities and the environment.”

Agrium president and CEO Chuck Magro called the transaction a “transformational merger," saying it creates benefits and growth opportunities that neither company could achieve alone.  “Combining our complementary assets will enable us to serve our customers more efficiently, deliver significant operating synergies and improve our cash flows to provide capital returns and invest in growth,” he said.

The new company will be led by a proven team that reflects the strengths and capabilities of both companies. Upon closing of the transaction, Tilk will serve as executive chairman, and Magro will serve as CEO, both reporting to the new board of directors. Wayne Brownlee will serve as chief financial officer, and Steve Douglas will serve as chief integration officer. Additional senior leadership positions for the new company will be named at a later date. The new company’s board of directors will have equal representation. The board’s independent lead director will be designated by Agrium.

In addition to leading the board of directors, the executive chairman will have executive responsibility for the new company’s business strategy function.

Following the closing of the transaction, the new company will have its registered head office in Saskatoon, Sask., with Canadian corporate offices in both Calgary, Alb., and Saskatoon.

The transaction will be implemented by way of a plan of arrangement under the Canada Business Corporations Act. It is expected to close during mid-2017, subject to the satisfaction of customary closing conditions, including receipt of regulatory approvals, Canadian court approval and approval by the shareholders of both companies.