Analyst Note
| Seth Goldstein, CFA |On Nov. 5, Mosaic announced Vale planned to divest its entire equity stake in Mosaic, which is 34.2 million shares, or roughly 9% of total Mosaic shares outstanding. Mosaic will repurchase one fourth of Vale's shares, while the remainder of shares will be sold on the open market. Vale will receive $1.26 billion in net proceeds, and we calculate the stock will be sold for an average price of $36.87 per share, which is only slightly above our $35 per share fair value estimate. Vale's share divestiture is a secondary offering, and our outlook for Mosaic is unchanged since our third-quarter earnings update. With no other changes to our model, we maintain our $35 per share fair value estimate and no-moat rating for Mosaic.