Mosaic (MOS) Repurchase Request Denied by MAC Trusts Following Cargill Split

June 25, 2013 4:32 PM EDT
The Mosaic Company (NYSE: MOS) provided an update today on the potential disposition of the 129 million Class A restricted shares held by the Margaret A. Cargill Foundation, the Anne Ray Charitable Trust (collectively, the MAC Trusts), and various family shareholders of Cargill, Incorporated (Cargill).

The two-year anniversary of the transaction resulting in the split-off of Mosaic from Cargill was May 25, 2013. Since that date, Mosaic has engaged in discussions with Cargill and the MAC Trusts regarding the disposition of the Class A shares, including a potential share repurchase transaction. In connection with these discussions, Mosaic, with the MAC Trusts' support, requested that Cargill amend the split-off agreement to allow for a negotiated repurchase of shares by Mosaic from the Class A shareholders prior to November 26, 2013. Following that date, no contractual restrictions remain on share repurchases.

After considering the request, Cargill declined to amend the agreement to allow for earlier share repurchases. As a result, Mosaic is not permitted to engage in open market or negotiated share repurchases until after November 26, 2013. The only practical means for the Class A shareholders to dispose of their shares prior to that date would be through an underwritten public secondary offering, which could be initiated by the MAC Trusts prior to June 26, 2013 or Mosaic thereafter. After considering its alternatives, the MAC Trusts have notified Mosaic that they will not exercise their current right to request an underwritten public secondary offering.

Mosaic is disappointed in its inability to effect share repurchases this summer and looks forward to initiating share repurchases after November 26, 2013. At that time, depending on market conditions and sellers' interest, Mosaic will consider the repurchase of shares either in a negotiated transaction with the Class A shareholders or through open market repurchases.

Mosaic continues to target the middle of 2014 to achieve its previously stated balance sheet targets.

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