CF Industries Holdings Inc. (CF) announced it has bought a 7% stake during the past two weeks in fellow fertilizer maker Terra Industries Inc. (TRA) as it confirmed plans to boost its all-stock offer to about $3.9 billion.

The announcement is the latest move in a three-way struggle for power in the fertilizer industry. Since the start of the year, Terra has repeatedly refused offers from CF, which is the subject of a $3.7 billion takeover attempt by Agrium Inc. (AGU). The industry is under strong pressure to consolidate after prices plunged from last year's highs.

Monday, CF offered to exchange its own shares at a ratio of 0.465 for each Terra share, which would be adjusted after Terra pays its planned $7.50 a share special dividend announced Thursday. CF said in early August it was prepared to raise its bid to 0.465 share from as much as 0.4539 share.

The new bid values Terra at $39.19 a share, an 11% premium to Friday's closing price.

CF said the 7% stake, purchased for $247 million, demonstrated its commitment to a deal with Terra.

CF shares were down 19 cents to $84.10 in early trading while Terra rose 1.3% at $35.65.

-By Joan E. Solsman, Dow Jones Newswires; 212-416-2291; joan.solsman@dowjones.com