Alberta NDP confident Agrium will maintain presence after Potash merger
NDP confident Agrium will maintain Alberta presence after Potash merger
JAMES WOOD, CALGARY HERALD
Published on: September 6, 2017 | Last Updated: September 6, 2017 5:14 PM MDT
Agrium president and CEO Chuck Magro speaks, during the company’s annual general meeting in May 2014. LARRY MACDOUGAL /THE CANADIAN PRESS
Alberta’s NDP government says it’s confident that Calgary is the place to be, as the issue of head office jobs related to the proposed merger of Agrium and Potash Corp. of Saskatchewan again comes to the fore.
Under terms of the merger, which is still under regulatory review, Saskatoon will be the location of the “registered head office” of the newly-formed Nutrien, while Calgary will also retain a substantive corporate office.
However, Chuck Magro, the CEO of Agrium who will become Nutrien’s chief executive, will continue to live and work in Calgary while maintaining a secondary residence in Saskatoon.
In recent days, Premier Brad Wall has been banging the drum on the issue, saying the Saskatchewan government wanted to ensure that Saskatoon is “indisputably the head office” and that it had “the maximum number of head office jobs.”
Speaking to reporters in Regina on Wednesday, Wall said his government would “look at every option” to ensure Saskatoon was the true head office of the company.
But Alberta Economic Development Minister Deron Bilous said Wall is “desperate to show his residents he’s standing up for Saskatchewan,” but he suggested Magro’s continuing presence in Calgary is a strong indication that the city will be key to the company.
“I’m going to leave it to Albertans to see the writing between the lines, that you’ve got the CEO staying in Calgary,” Bilous said in an interview Wednesday.
“They may decide to open an office to meet some of Saskatchewan’s requirements. But, again, I’m confident that we’re going to continue to see . . . a number of positions will remain in the province.”
Bilous said Calgary’s status as an international hub and Alberta’s lower taxes make it a natural fit for what will be a global player in Nutrien.
“When you look at all the facts, our province stacks much higher than the province of Saskatchewan,” he said.
Richard Downey, Agrium’s vice-president of investor and corporate relations, said most of the work integrating the two companies is on hold while the deal remains under regulatory review in a number of jurisdictions.
But he said both cities will have “significant corporate offices, post-merger.”
“Nothing’s really changed,” said Downey.
“We’re a global company and there will be senior management at both Calgary and Saskatoon locations.”
Downey declined to put numbers on the current complement of employees in the PotashCorp headquarters in Saskatoon or the Agrium head office in Calgary.
He acknowledged there will be “some reduction in corporate office positions.”
The $36-billion deal by the new companies announced nearly a year ago was touted as a “merger of equals” that would create the world’s largest nutrient company and the third-largest natural resource company in Canada.
Under Saskatchewan legislation, the head office of PotashCorp — originally created in the 1970s as a Crown corporation — must be located in the province. Wall has pointed to a pledge made by PotashCorp in 2011, after the federal government blocked a hostile takeover by BHP Billiton, that the company would maintain a “strong and vital corporate headquarters” in Saskatchewan, with 11 of its 14 senior executives living and working in Saskatoon.
The Saskatchewan premier said Wednesday that having a CEO split time between cities — as former PotashCorp CEO Bill Doyle did — is “not optimal” but the overall number of head office jobs is the bigger issue.
He said Saskatchewan legislation provides a more favourable royalty rate for companies with head office jobs in the province.
“If we were able to provide that incentive, we could also move the other way,” said Wall.