VT, Viterra Inc

vt lvt s

We have seen this movie before, with Potash as the main actor instead of Viterra. There are many differences but there are also many similarities. Both started life as “cooperative” endeavours that “pooled” the energies of many farmers or many miners in order to manipulate the markets. This was done in the form of crown corporations that were , fairly recently, “demutualized” so to speak and now operate as private stock companies and now operate by raw capitalist rules. This explains the extraordinary situation where a single foreign individual can accumulate a fortune of nearly a billion dollars in ten years time and simultaneously enjoy the  fatherly (misguided?) support of the premier of the province that is , arguable, Canada’ most socialistic. The point really is that there are a lot of undercurrents in these situations. They create deal risk. We have it all the time. Potash is trading well below the peak it reached soon after the announcement. X, the Toronto stock exchange trades well below the takeover bid by the Maple group, Lundin was a complete disaster etc.etc.

You should sell here!, or if you enjoy playing chicken little with a freight train, wait for $15.25 where the stock would “double-top”. Later on, with the benefit of hindsight, this may well prove to be the wrong  thing to do, but at this moment it is the smartest thing to do.