Sometimes you get lucky - I'm chalk this up in that column. Mosaic (MOS) is surging nearly 8% today on the rumor mill of Cargill takeover. This was one of the positions we loaded back into this morning (sorry I just noticed I posted the purchase on twitter but not here on blog) Apologies on that end; hard to multi task during day - should of been added to the "Various Buys" post.

I am going to sell the stake I bought this morning near $38, at just over $43 (about 1.8% of the fund) - we are still keeping our core position. This gives us a half day >10% gain.

12:12 MOS Mosaic follow-up: Talk on MOS is that Cargill will buy remainder of co for price in $58-60 range; Cargill owns approx. 64% of MOS (40.77 +1.11)

We talked about the potential of this deal back in October 2008 (Oct 28, 2008: Noteable Calls - Mosaic Cargill Standstill Expires Oct 22)

Soleil's Gulley & Associates is out with a noteworthy call on Mosaic (NYSE:MOS) noting that Cargill's four-year standstill re Mosaic expires this Wednesday. The expiration sets up the possibility that Cargill could accept the gift that "Mr. Market" is presenting: accretively increasing its ownership stake in Mosaic.

How accretive? Buyout of the 35% minority stake could boost Cargill earnings by more than 20%, given the fact that Mosaic is currently trading at just 2.7x consensus calendar 2009E EPS of $12.25.

Could just be a hedge fund starting a rumor to create some action; who knows. But I won't look a gift horse in the mouth.

But remember, as we said over and over - there is cash flow and valuation in these fertilizer companies and with the Agrium (AGU) CF Industries (CF) Terra (TRA) group hug - things could be heating up in the sector. (Feb 25, 2009: Agrium Launches $3.6 B Takeover Bid for CF Industries) (Jan 16, 2009: Congratulations Terra Industries Holders)