Loeb's Third Point opens stake in CF Industries: letter

Daniel Loeb's hedge fund Third Point initiated a new position in nitrogen fertilizer manufacturer CF industries during the second quarter, according to a quarterly investor note.

"CF currently trades at an unwarranted discount to fertilizer and commodity chemical peers," Loeb said in the letter, dated July 29. "We believe its structural cash flow generation strength is misunderstood and that management should deliver a much larger dividend to its shareholders."

Loeb said that CF's "access to low-cost North American natural gas - the primary input in nitrogen fertilizer production - gives the company a structural, sustainable margin capture relative to global peers with higher input costs."

(Reporting by Katya Wachtel; Editing by Gary Hill)