12/15/2016 18:33 EST | Updated 12/16/2017 00:12 EST

Chemtrade Logistics Income Fund to acquire Canexus

TORONTO — Chemtrade Logistics Income Fund (TSX:CHE.UN) says it has reached an agreement to purchase Canexus Corp. (TSX:CUS).

Chemtrade says under the agreement, Canexus shareholders will receive $1.65 in cash per common share, which represents a 33 per cent premium over the closing price on TSX as of Tuesday.

The new price is up from an earlier bid of $1.50 per share that Canexus urged its shareholders to reject.

The Calgary-based Canexus board of directors is unanimously recommending the deal be accepted by shareholders, who will consider the sale at a special meeting expected to be held in early February.

The sale is subject to a number of conditions, including court and regulatory approvals.

Toronto-based Superior Plus had pulled out of a deal to buy Canexus earlier this year following comments by the U.S. Federal Trade Commission that it would try to block the transaction because of its impact on competition in North America's sodium chlorate market.

Toronto-based Chemtrade is one of North America's largest suppliers of sulphuric acid and a host of other chemical products.

"We are very pleased to have reached an agreement with Canexus resulting in a mutually beneficial outcome for Canexus shareholders and Chemtrade unitholders," said Chemtrade CEO mark David.

He said the sale will while further diversify the company's North American operations and allow it to "enter attractive South American markets."