April 9, 2013 / 7:35 PM / 6 years ago

Agrium sweeps proxy vote, Jana cries foul

CALGARY, Alberta (Reuters) - Canadian fertilizer company Agrium Inc AGU.TO said on Tuesday its entire slate of directors had been elected to its board, defeating a rival slate nominated by dissident U.S. shareholder Jana Partners.

Michael Wilson president and CEO of Agrium smiles after the company's annual general meeting in Calgary, Alberta, April 9, 2013. REUTERS/Todd Korol

Jana, the hedge fund that is Agrium’s biggest single shareholder, said the vote was tainted and should be investigated. Agrium said the result was “fair and square”.

Shares of Agrium, the world’s third largest nitrogen producer and the largest farm retailer in the United States, fell around 3 percent in New York and Toronto.

Jana said votes cast for some of its five candidates for the 12-member board were revoked after Friday’s deadline.

The shutout of its candidates does serious damage to Jana’s case for breaking up Agrium, which is a wholesale producer of potash, nitrogen and phosphate fertilizer, as well as being a farm-products retailer.

Jana’s managing partner, Barry Rosenstein, said the hedge fund had had enough votes as of Friday’s deadline to elect one or more of its candidates, and that the vote was “tainted”.

“We have learned, however, that yesterday, three days after the vote deadline, votes for us were revoked, enough apparently to change the outcome of the vote,” he said at Agrium’s annual meeting in Calgary, Alberta.

An Agrium spokesman said, “the loss was pure and simple, fair and square”.

Jana, which owns 7.5 percent of Agrium, favors a breakup of the company and wants Agrium to cut costs in its retail division, return cash to shareholders and improve disclosure. Agrium says keeping its wholesale fertilizer production and retail business under one roof adds value.

Both sides frequently accused each other of dirty tricks during the proxy battle.

Agrium shares were down 2.8 percent in New York at $94.92 and down 3.2 percent at C$96.20 in Toronto.

($1=$1.02 Canadian)

Writing and additional reporting by Rod Nickel in Winnipeg, Manitoba and Euan Rocha in Toronto; Editing by Gerald E. McCormick; and Peter Galloway

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