UPDATE 3-Agrium fires back at Jana's plan to split company

Mon Jan 28, 2013 2:28pm EST
 
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* Agrium raises 2015 earnings target for retail side

* Says share buyback, dividend boost unrelated to Jana

* Jana says healthy debate begun but Agrium ignoring issues

By Rod Nickel

Jan 28 (Reuters) - Canadian fertilizer company Agrium Inc will not split its wholesale and retail divisions as its biggest shareholder, Jana Partners, wants because doing so would "destroy value" for shareholders, Chief Executive Mike Wilson said on Monday.

Wilson was speaking in New York to Agrium's sell-side analysts in an attempt to blunt Jana's move to replace some of Agrium's board and effect changes that Jana says would increase returns to investors. He ruled out a break-up of the company, and released a sharply higher earnings forecast for the fast-growing retail division, which sells seed, fertilizer and chemicals to farmers.

Wilson said Jana preferred to talk to Agrium's shareholders and analysts rather than to the company itself, although Agrium and Jana had reached an understanding last spring that they would keep their talks on improving the company private.

"They'll say one thing and do the opposite ... They're good at breaking up companies," Wilson said. "They're very good at saying, 'Why not just engage some ideas?' The answer is, if we do, we'll destroy value for our company, and we're not about to do that."

The company forecast that EBITDA (earnings before interest, taxes, depreciation and amortization) for the retail business would climb to $1.3 billion by 2015, up from its previous target of $1 billion and a jump of over two thirds from 2011. The growth will come mainly from its pending purchase of Viterra's retail chain, smaller buys and organic growth, Agrium said.   Continued...