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Nutrien will auction SQM shares next Monday and mark the end of an era

The biggest business in recent years in the local market has a day and time to materialize.

Yesterday at noon, the Canadian Nutrient company (continued from Potash Corp) was listed on the Santiago Stock Exchange, auctioning more than 62 million Series A SQM shares, representing almost 24% of its ownership. And it arranges operations for Monday, December 3, 9:15 a.m., which will be held in the wheel room of the main stock exchange in the country.

This package must be obtained by Tianqi China, which will mark a milestone: Nutrien will leave the property of SQM after 15 years, where he names board members and participates in corporate decision making, and Asian companies will enter his place.

The transaction, which will be led by Banchile Corredores de Bolsa, will have a minimum price of US $ 65 per share, so that the expected amount will be US $ 4.066 million.

So, if there are no surprises, the operation marked by this controversy will be sealed.

Compliance Program

After the Free Competition Defense Court (TDLC) agreed to an agreement between the National Economic Prosecutor's Office (FNE) and Tianqi in early October for the final entry into the SQM property, new negotiations began.

According to the PULSO published in October, this is a design made by China and Chile of the so-called compliance program, which consists of a compliance protocol that Tianqi agreed to with FNE and which seeks to limit the risk of illegal coordination between directors. from both companies.

One of the most relevant details to protect relates to the potential for illegal information exchange related to the lithium market, where both companies are the biggest players in the world.

So, let's say the source knows the process, ready for next year: in April 2019 it will consider three directors named Tianqi in SQM, after that China will have a 60 calendar day deadline to submit their proposals to the board of the Chilean mining company.

This process is qualified by experts as "essential" and even more important than the TDLC's own decision. It should be noted that this new step is being dealt with, especially, at the level of lawyers who specialize in free competition and laws regarding companies.

In this context, the source of the comment, the Pampa group, which represents the interests of Julio Ponce, who controls SQM through a cascade company, can press this way to improve – from the point of view – the conditions of the agreement that allow Tianqi to enter SQM.

History of struggle

In May this year, an agreement was announced between Nutrien and Tianqi, where the latter will buy participation from the former at SQM.

The following month, the FNE announced the opening of an investigation to evaluate the possible impacts of free competition that the operation could carry out. This, along with complaints made by Corfo and Senator Alejandro Guillier.

In this way, the transaction is frozen while the investigation is extended. In parallel, at the end of August, FNE reported that they reached an agreement outside the court with Tianqi in which the country established various measures to reduce the risks that could be caused by operations in terms of free competition.

The steps include that Tianqi will not elect its directors, executives or company employees to be part of the SQM board of directors, and that neither the Chinese company nor its directors will be able to influence or interfere with Tianqi's interests or harm the interests of the company. Chile mining.

After that, the agreement was brought to TDLC to give his approval. In the middle, in September, the allegations were made, in which the Pampa group opposed the agreement.

Nevertheless, the TDLC approved the agreement in early October, after which the Pampa group returned to the charges, but once again their efforts failed.

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