Piper Jaffray Remains Bullish on CF Industries (CF) Ahead of Potential OCI Acquisition

Piper Jaffray maintained an Overweight rating and $71.00 price target on CF Industries (NYSE: CF) following an article in the Wall Street Journal that noted discussions for the company to acquire OCI. Analyst Brett Wong said that OCI confirmed that discussions are ongoing around potential merger or acquisition.

Wong commented, "On Friday, the Wall Street Journal released an article that CF was in discussions to acquire Netherlands based nitrogen fertilizer and chemical provider OCI, sending CF shares up 10% Friday. Early Monday morning, OCI confirmed discussions are ongoing around a potential merger or acquisition, but did not comment on any other details. We believe that the potential acquisition would be beneficial for CF adding low cost nitrogen fertilizer tons in the U.S. and Middle East, but we believe CF will likely have to pay up for the assets, above where CF shares are currently trading. We still believe the deal could be accretive, depending on the deal structure, which would significantly increase CF debt ratio, but we only expect modest savings from a potential inversion given the heavily U.S. based business for CF. There is a lot of uncertainty if a deal will happen but we remain Overweight on CF."

For an analyst ratings summary and ratings history on CF Industries click here. For more ratings news on CF Industries click here.

Shares of CF Industries closed at $68.92 yesterday.

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