Feb 11 (Reuters) - Agrium Inc appointed two independent directors to its board after the Canadian fertilizer maker could not come to terms with U.S. activist shareholder Jana Partners, which wants to break up the company.
David Everitt, a former president of Deere and Co, and Mayo Schmidt, a former chief executive of Viterra Inc before it was bought by Glencore International, were appointed as directors, Agrium said in a statement.
Jana, the largest investor with 6 percent of shares, was pushing for two director nominees and wanted Agrium to spin off its farm retail division, the largest in the United States, which sells seed, fertilizer and chemicals.
Agrium said Jana reneged on an agreement to cease its pursuit of a break-up in return for naming one of its director nominees to the board. Instead, the activist shareholder demanded two seats on the board.
“We are disappointed in Jana’s decision to prolong this fight which it is certain to lose. Shareholders are clearly not supportive of Jana’s initiative to break up Agrium,” the Canadian firm’s chief executive officer, Michael Wilson, said.
Jana, among other demands, wants Agrium to cut costs, return cash to shareholders and improve disclosure.
The New York hedge fund said in a separate statement that Agrium initially promised to name directors who would address the board’s “deficiencies in experience” and Jana’s other concerns, but its nominees fell short of expectations.
The proxy fight is the latest in a series of high-profile battles led by activist investors seeking to shake up the management of leading Canadian companies. Last year, investor William Ackman, using tactics similar to those employed by Jana, succeeded in installing his hand-picked candidate as chief executive of Canadian Pacific Railway Ltd.
Jana, a top U.S. activist investor, has won high-profile campaigns at companies such as Marathon Petroleum Corp and McGraw-Hill Cos Inc.