Australia’s and the world’s biggest mining firm, BHP Billiton, is still keen on acquiring the Canadian firm, Potash Corp, as reports emerge that China is mulling a bid for Potash Corp as well. Ever since BHP’s plans came into being in May, the Australian firm has kept a low but stern profile over the potential purchase.

If it should be successful, BHP will remit a staggering $39 billion for the takeover of Potash Corp. Lately, the Australian firm has taken a low profile, as Potash Corp. struggles to fend off the unsolicited takeover prospect. It is understood that BHP executives have been under pressure to undertake a major acquisition, but the executives have instead played down the potential transaction.

China is reportedly stepping up attempts to scuttle BHP Billiton’s hostile takeover bid for Potash Corp, amidst worries over future fertilizer supplies that China requires to rapidly increase its food production. In that regard, Chinese state run firm, Sinochem has reportedly hired HSBC to advise it on the available options with respect to Potash Corp, the biggest global manufacturer of fertilizer.

The Wall Street Journal Wednesday reported that the Chinese company had undertaken the move as a preliminary measure towards deciding on its options, but not as a final decision regarding its participation in the bidding war for the Canadian fertilizer maker. However, Potash Corp’s officials came close to admitting that Potash Corp may use a shareholder rights plan to try and scuttle any share raid by the Australian firm. Reports indicate that Potash and Sinochem may have held talks already.

Early this week, BHP executives told shareholders they were keenly following potential rival bids. It is understood that banks, not involved in advising either of the two firms, are trotting the globe for potential rival bidders, not wanting to miss out on the action. According to Wall Street Journal report, some investment bankers are keenly looking for a role in the potential acquisition of Potash Corp and may be looking for a potential secondary bidder against BHP.

Analysts suspect something might come out of the efforts by investment banks missing in the action to set up a secondary bidder for Potash. However, until that happens, BHP executives reiterated that their bid still stands as it is and will not be raised, unless Potash finances a white night to create some bidding tension.

2 Sep 2010.