Rio Tinto Mulling Potash Bid (RTP, POT, BHP)

Global miner Rio Tinto RTP is reportedly in talks with a Chinese company to acquire Potash Corp of Saskatchewan POT, following a failed hostile takeover bid by BHP Billiton BHP. According to Canada’s “Globe & Mail” website, the company "is said to be considering a bid alongside a Chinese player” in a race to acquire Potash. POT executives said on Monday that they are “considering” and “looking out” for third-parties putting pressure on BHP to up its stakes. While China’s Sinochem and Brazil’s Vale were in the acquisition race, Vale pulled out yesterday. Potash formally rejected the $130-a-share bid launched last week by BHP and said it expected an alternative bid to emerge. POT shares have surged above $150, signalling that investors expect a higher bid from BHP or a rival bidder. Analysts and investment bankers think that POT may just go into talks with other companies in an attempt to garner a higher bid from BHP. "It's clear that they are in auction mode and that's what you have to do,” remarked Chris Damas, analyst at BCMI Research. If BHP is going to raise its bid, analysts do not see it doing so before Wednesday, when it will declare its fiscal results. The company is also expected to get all regulatory compliances in place before launching a fresh bid. BHP is trading at $66.15, down 1.46% in pre-market. POT is trading at $150.68, up 0.32% and RTP is trading at $49.53, down 2.58% in pre-market. Read more from Benzinga's Company news.