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BHP Billiton Group Announces Commencement of All Cash-Offer to Acquire PotashCorp

BHP Billiton BHP Billiton today announced that an indirect wholly-owned subsidiary of BHP Billiton Plc, BHP Billiton Development 2 (Canada) Limited (the "Offeror"), has commenced the previously announced offer (the "Offer") to acquire all of the issued and outstanding common shares of Potash Corporation of Saskatchewan Inc. ("PotashCorp") (NYSE:POT/TSX:POT), at a price of US$130 in cash per PotashCorp common share (the "Offer"). The Offer values the total equity of PotashCorp at approximately US$40 billion on a fully-diluted basis.

The Offer represents an attractive premium of 20 per cent to the closing price of PotashCorp's shares on the NYSE on 11 August 2010, the day prior to BHP Billiton's first approach to PotashCorp. It is also a premium of 32 per cent and 33 per cent to the volume weighted average trading prices of PotashCorp's shares on the NYSE for the 30-trading day and the 60-trading day periods ended on the same date, respectively. The Offer is open for acceptance until 11:59 p.m. (Eastern time) on 19 October 2010, or such later date or dates as may be fixed by the Offeror unless the Offer is withdrawn.

BHP Billiton (ASX:BHP/LSE:BLT/NYSE:BBL/JSE:BIL) is the world's largest diversified natural resources company with approximately 41,000 employees working in more than 100 operations in 25 countries. BHP Billiton has significant positions in major commodity businesses, including aluminum, energy coal and metallurgical coal, copper, manganese, iron ore, uranium, nickel, silver and titanium minerals, and has substantial interests in oil, gas, liquefied natural gas and diamonds.

BHP Billiton has a market capitalization of approximately US$188 billion (as at 16 August 2010).

BHP Billiton was created through the dual listed companies (DLC) merger of BHP Limited (now BHP Billiton Limited) and Billiton Plc (now BHP Billiton Plc), which was concluded on 29 June 2001. BHP Billiton Limited and BHP Billiton Plc continue to exist as separate companies, but operate on a combined basis as BHP Billiton and retain their respective listings on the Australian and London stock exchanges. Both companies have identical boards of directors and are run by a unified management team. Shareholders in each company have equivalent economic and voting rights in BHP Billiton as a whole. The global headquarters of the combined BHP Billiton are located in Melbourne, Australia.

BHP Billiton has engaged J.P. Morgan Securities Inc., TD Securities, Banco Santander, Barclays Capital (the investment banking division of Barclays Plc), BNP Paribas and The Royal Bank of Scotland Group Plc as financial advisors in connection with this Offer. Its legal advisors are Blake, Cassels & Graydon LLP in Canada and Cleary Gottlieb Steen & Hamilton LLP in the United States.

PotashCorp is the world's largest integrated fertilizer and related industrial and feed products company and the largest producer of potash worldwide by capacity. In 2009, PotashCorp estimated its potash operations represented 11% of global production and 20 per cent of global potash capacity. PotashCorp owns and operates five potash mines in Saskatchewan and one in New Brunswick. PotashCorp also holds mineral rights at the Esterhazy mine in Saskatchewan where potash is produced under a mining and processing agreement with a third party.

PotashCorp's phosphate operations include the manufacture and sale of solid and liquid phosphate fertilizers, animal feed supplements and industrial acid, which is used in food products and industrial processes. PotashCorp has an integrated phosphate mine and processing plant in North Carolina, a phosphate mine and two mineral processing plant complexes in northern Florida and six phosphate feed plants in the United States. PotashCorp can also produce a variety of phosphate products at its Geismar facility in Louisiana.

PotashCorp's nitrogen operations involve the production of nitrogen fertilizers and nitrogen feed and industrial products, including ammonia, urea, nitrogen solutions, ammonium nitrate and nitric acid. PotashCorp has nitrogen facilities in Georgia, Louisiana, Ohio and Trinidad.

For the year ended 31 December 2009, PotashCorp had audited consolidated revenues of US$3,977 million (2008: US$9,447 million), EBITDA of US$1,504 million (2008: US$4,963 million) and profit before taxation of US$1,071 million (2008: US$4,572 million). As at 31 December 2009 PotashCorp had audited gross assets of US$12,922 million and net assets of US$6,501 million. The PotashCorp financial information presented above has been extracted without amendment from published financial reports which are presented in US dollars and prepared under Canadian Generally Accepted Accounting Principles.

Published 20/08/2010

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