Bloomberg this week took a look at the upcoming unlocking of restrictions on Cargill-affiliated shares in the Mosaic Co. and reached the conclusion that Mosaic is a takeover target.
Maybe. But it seems far more likely that a buyer for the shares has already been identified and it’s not going to be the likes of BHP Billiton, the large Australian minerals company.  It will be Mosaic.
About 129 million shares of Mosaic, or a roughly 30-percent interest, are held by trusts related to the Cargill family. The continued holdings in Mosaic are a result of Minnetonka-based Cargill’s split-off of its 64-percent interest in Mosaic two years ago. 
Beginning later this month, the Cargill holders can request that Mosaic register the shares and tee up a secondary offering to sell those shares into the market. Mosaic has a right of first refusal on the shares and can tender for shares at a 20-day moving average price.
On Monday Mosaic management is planning to hold a conference call with investors to discuss its “capital management philosophy,” and while there may not be a plan disclosed in detail then there’s every reason to think Mosaic will be philosophically inclined to buy back those Cargill-related shares.
Recent notes from research analysts like Vincent Andrews of Morgan Stanley & Co. suggest that Mosaic has the cash flow and debt capacity to finance the buy back and still be able to fund capital investments and other growth initiatives.

The market is looking for roughly 10 percent of the outstanding shares of Mosaic stock to be repurchased in 2013, Andrews wrote, and “not coincidently, this is roughly the same of stock that unlocks in 2013” from the Cargill-related trusts.