Potash Corp. of Saskatchewan Inc., the Canadian fertilizer producer, is in early-stage discussions to acquire German potash supplier K+S AG, according to two people familiar with the matter.
K+S, the Kassel, Germany-based company, is considering the proposal though no final decision has been made, said the people, who asked not to be identified because the talks are private. Any deal could value K+S at more than 7 billion euros ($7.9 billion) according to newspaper Handelsblatt, which reported Potash’s interest earlier.
Representatives for Potash and K+S declined to comment.
K+S, Europe’s largest potash supplier, in May raised its forecast for full-year revenue after first-quarter earnings and sales exceeded analyst estimates amid higher prices for crop nutrient potash and salt. The company predicts full-year earnings will increase significantly as prices for the fertilizer product recover from a ramp-up in production following the breakup of a Russia-Belarus industry cartel in mid-2013.
K+S has risen 27 percent this year, valuing the company at 5.6 billion euros. Potash has a market capitalization of C$32 billion ($26 billion).