PotashCorp of Saskatchewan, the Canadian fertiliser company and the world’s largest potash producer, has approached its German rival, K+S Kali, about a possible takeover bid. Industry sources claim that PotashCorp is offering €40 per share, valuing K+S at more €7.5bn.

K+S is based in Kassel in central Germany and is Europe’s largest potash supplier. The company said it is currently assessing its options after receiving the proposal from PotashCorp. Any transaction would be one of the largest in the history of the fertiliser industry and further consolidate an already concentrated sector.

Prior to the announcement, K+S shares stood at €28.55 giving the company a market capitalisation of more than €5.4bn. However, since Thursday K+S shares have soared by more than 30% adding more than €2bn to the group’s stock market value.

Shares in PotashCorp, which has a market capitalisation of €23.7bn, were up 4.3% on the back of the announcement.