Click here to close now.




















Welcome!

Microsoft Cloud Authors: Eric Aarrestad, Greg O'Connor, Liz McMillan, Aleksei Gavrilenko, Elizabeth White

News Feed Item

JANA Partners Issues Open Letter To Shareholders

Further Information Available at www.JANAAguAnalysis.com

NEW YORK, Feb. 20, 2013 /PRNewswire/ -- JANA Partners LLC today released the following open letter to shareholders of Agrium, Inc. ("Agrium") (TSX / NYSE: AGU).  Agrium announced at the end of the day last Friday that its Annual General Meeting of Shareholders will be held on April 9, 2013 and that shareholders of record on February 25, 2013 will be eligible to vote.

February 20, 2013

AN OPEN LETTER TO AGRIUM SHAREHOLDERS: 
Why We Said No to the Status Quo at Agrium, and Why You Should Too

Dear Fellow Agrium Inc. Shareholder,

We have invested more than $1 billion in Agrium, making us the largest shareholder with approximately 6.5% of its outstanding shares, because we believe Agrium can generate substantial additional upside for all shareholders by addressing 5 core issues:  Costs, Controls, Capital Allocation, Conglomerate Structure and Corporate Governance.  Agrium however refuses to fully address these issues, and has subverted traditional notions of good governance by fighting off our highly qualified independent nominees and choosing their own directors merely because we have questioned its performance and strategy.  We note that the market has had a swift and negative reaction to this refusal to engage, including a 7% share price decline last week after Agrium's new directors were announced and our rejection of its insufficient settlement offer.

Upending Notions of Good Corporate GovernanceAgrium has sought to turn traditional notions of board oversight of management upside down by making any questioning of management's prior performance or strategy a disqualification for board service.  When asked recently why Agrium refused to consider our candidates, Agrium's CEO responded that "It is not typical to bring someone on the board who tells you your strategy is flawed and indirectly tells you you're incompetent." (The Globe & Mail, Feb. 4, 2013).  JANA has of course never called management "incompetent."  We have simply identified areas of substantial opportunity and proposed qualified nominees to help explore them.  This same fortress mentality was on display in our recent settlement discussions, with Agrium demanding at one point that we drop all of our issues in exchange for merely proceeding with talks, and refusing to even speak to our nominees. 

This thin-skinned and insular attitude leads us to conclude that Agrium's new directors have been pre-screened to ensure compliance with the status quo.  We further note that Agrium did not cast a very wide net to locate new board appointee Mayo Schmidt, given that Viterra's distribution business was acquired by Agrium in a transaction in which he earned over C$30MM.  We also note that our board nominees stand to benefit only to the extent that all shareholders benefit and each meets the definition of "independence" under the CBCA, NYSE rules, and Agrium's own governance guidelines.

Just last Friday, Agrium doubled-down on its approach, shifting up the usual date of its annual meeting by over a month in an apparent attempt to cut short this debate.  While we are confident that this move is too little, too late, it further paints a picture of serious governance issues at Agrium.  As one analyst put it, "Friday after the close at the start of a holiday weekend isn't typically when company Boards disclose things they are proud of, but you can't fault the Agrium Board for consistency. An abrupt shift in the dates for the shareowner meeting looks designed to perpetuate the lack of transparency and accountability that seems to be the (very) unexpected legacy of CEO Mike Wilson. Investors who have been supportive of Agrium thus far will have to think hard about whether this is the sort of behavior they want to encourage elsewhere, when they cast their ballots in this accelerated election." (Credit Agricole / CLSA, Feb. 19, 2013)

Refusal to Address Core IssuesWhen Agrium approached us seeking a settlement, we made clear that for any settlement to occur the board would need to commit to conducting a full review of the branch footprint of its distribution business ("Retail") and corporate overhead (Costs) and a full review of Retail senior management performance objectives (Controls), to communicate a targeted dividend payout ratio or some other mechanism to clarify ongoing capital return plans (Capital Allocation) and to retain a new investment bank to perform a review of Agrium's structure (Conglomerate Structure), in addition to adding highly-qualified and independent new directors rather than fighting off such change (Corporate Governance).  Agrium however refused to commit to even the mildest versions of these concepts.

Appointing New Directors Who Lack Relevant ExperienceNeither of Agrium's chosen new directors addresses the board's lack of distribution experience, which is of crucial importance given the size of Agrium's Retail business. 

  • Mayo SchmidtWhile Mr. Schmidt served as CEO of Viterra Inc. before it was acquired by Glencore and Agrium, Viterra's distribution business accounted for less than 15% of EBITDA and served primarily to advance its grain handling business. Agrium has also noted significant opportunities for improvement at Viterra's distribution business, which calls into question Mr. Schmidt's abilities in areas like cost management.  We also note that like Agrium, Viterra struggled in basic areas of oversight and performance including Costs, given Viterra's consistently high annual growth rate in corporate overhead, and Capital Allocation, given that Viterra executed no share repurchases (instead issuing over $2 billion of equity) and initiated a small dividend only after coming under pressure from shareholders to do so.
  • David EverittMr. Everitt ran a unit at Deere & Co. that manufactured and sold capital equipment to a separate independently-owned and operated dealer network. While he has experience in agriculture and with manufacturing and supply chain issues, he brings no experience in managing true "breaking bulk" distribution of primarily third party manufactured products, which is a crucial gap given that Agrium's Retail business purchases the vast majority of its products from third party suppliers and breaks bulk to distribute to farmer customers.

By contrast, 3 of our 5 nominees bring more than 75 years of combined experience creating substantial value in true "breaking bulk" distribution and excellent track records of deploying capital with a true owner orientation.

Questions for Every Shareholder.   

  • Wouldn't a board more concerned with good governance and continuous improvement than avoiding criticism have agreed to merely fully explore the issues we set forth above, given the billions in potential value creation?
  • Why would the board resist adding a minority of new directors who actually have the experience to ask the right questions about Retail's operations and strategy?
  • Why would a board that has spent $4 billion on Retail acquisitions that have failed to meet Agrium's minimum return hurdle and which failed for years to engage in significant shareholder return of capital until pressured to do so refuse to simply clarify its ongoing capital return plans?
  • Why would a board that has overseen a 14% annual growth rate in corporate overhead, has a Retail footprint which by Agrium's own admission and measurement standards has a glaring degree of duplication, and has generated negative operating leverage refuse to consider seriously examining its costs?
  • If Agrium's conglomerate structure truly creates more value than a separation, why is the board so resistant to an independent and fair review, particularly given the flaws in its initial review including manipulating trading comparables and hiring advisors who once argued against Agrium's structure to now defend it, and given that our nominees will constitute only a minority of the board once elected?
  • Why would a board that has consistently set compensation targets for Retail management that prioritize growth through acquisitions over profitability refuse to an enhanced review of these compensation targets and objectives?
  • Why would a board that has overseen a litany of corporate governance failings including talking down its own value to avoid a debate, botching a significant share repurchase, accelerating its annual meeting date and more resist adding independent and shareholder-oriented new directors?

We believe the board should be saying yes to these opportunities to unlock Agrium's full value creation potential, rather than wasting substantial shareholder money fighting them off, and we remain confident that once our highly qualified and shareholder-focused director candidates are elected, the board will do so.

Sincerely,

JANA Partners LLC

Information in Support of Public Broadcast Solicitation

JANA is relying on the exemption under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations to make this public broadcast solicitation.  The following information is provided in accordance with corporate and securities laws applicable to public broadcast solicitations.

This solicitation is being made by JANA, and not by or on behalf of the management of Agrium.

The address of Agrium is 13131 Lake Fraser Drive S.E., Calgary, Alberta T2J 7E8.

JANA has filed an information circular containing the information required by Form 51-102F5 – Information Circular in respect of its proposed nominees, which is available on Agrium's company profile on SEDAR at www.sedar.com and at www.JANAAguAnalysis.com.

Proxies for the Agrium shareholders' meeting may be solicited by mail, telephone, email or other electronic means as well as by newspaper or other media advertising, and in person by managers, directors, officers and employees of JANA, who will not be specifically remunerated therefor.  In addition, JANA may solicit proxies in reliance upon the public broadcast exemption to the solicitation requirements under applicable Canadian corporate and securities laws, conveyed by way of public broadcast, including through press releases, speeches or publications, and by any other manner permitted under applicable Canadian laws.  JANA may engage the services of one or more agents and authorize other persons to assist it in soliciting proxies on behalf of JANA.  All costs incurred for the solicitation will be borne by JANA.

JANA has entered into agreements with Kingsdale Shareholder Services Inc. ("Kingsdale") and The Laurel Hill Advisory Group Company ("Laurel Hill") pursuant to which Kingsdale and Laurel Hill have agreed to assist JANA in soliciting shareholders should JANA commence a formal solicitation of proxies.  Kingsdale's responsibilities will principally include advising JANA on governance best practices, where applicable, liaising with proxy advisory firms, developing and implementing shareholder communication and engagement strategies, and advising with respect to meeting and proxy protocol. Laurel Hill will be principally responsible for the solicitation of retail shareholders and other strategic advice. Pursuant to the agreement with Kingsdale, for its solicitation services, Kingsdale would receive a fee in the range of $125,000 to $250,000, plus disbursements and a telephone call fee.  In addition, Kingsdale may be entitled to a success fee on the successful completion of JANA's solicitation, as determined by JANA in consultation with Kingsdale. Kingsdale will also receive a separate fee for its other services. Pursuant to the agreement with Laurel Hill, Laurel Hill would receive a fee of up to $100,000, plus disbursements and a telephone call fee. In addition, Laurel Hill will be entitled to a success fee of $100,000 on the successful completion of JANA's solicitation. All costs incurred for the solicitation will be borne by JANA.

JANA is not requesting that Agrium shareholders submit a proxy at this time.  Once JANA has commenced a formal solicitation of proxies, a registered holder of common shares of Agrium that gives a proxy may revoke it: (a) by completing and signing a valid proxy bearing a later date and returning it in accordance with the instructions contained in the form of proxy to be provided by JANA, or as otherwise provided in the final proxy circular, once made available to shareholders; (b) by depositing an instrument in writing executed by the shareholder or by the shareholder's attorney authorized in writing, as the case may be: (i) at the registered office of Agrium at any time up to and including the last business day preceding the day the meeting of Agrium shareholders or any adjournment or postponement of the meeting is to be held, or (ii) with the chairman of the meeting prior to its commencement on the day of the meeting or any adjournment or postponement of the meeting; or (c) in any other manner permitted by law.  A non-registered holder of common shares of Agrium will be entitled to revoke a form of proxy or voting instruction form given to an intermediary at any time by written notice to the intermediary in accordance with the instructions given to the non-registered holder by its intermediary.

To the knowledge of JANA, neither JANA nor any of its managers, directors or officers, or any associates or affiliates of the foregoing, nor any of JANA's nominees, or their respective associates or affiliates, has: (i) any material interest, direct or indirect, in any transaction since the beginning of Agrium's most recently completed financial year or in any proposed transaction that has materially affected or would materially affect Agrium or any of its subsidiaries; or (ii) any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter currently known to be acted upon at the meeting of Agrium shareholders other than the election of directors.

SOURCE Jana Partners LLC

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@ThingsExpo Stories
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
For IoT to grow as quickly as analyst firms’ project, a lot is going to fall on developers to quickly bring applications to market. But the lack of a standard development platform threatens to slow growth and make application development more time consuming and costly, much like we’ve seen in the mobile space. In his session at @ThingsExpo, Mike Weiner, Product Manager of the Omega DevCloud with KORE Telematics Inc., discussed the evolving requirements for developers as IoT matures and conducted a live demonstration of how quickly application development can happen when the need to comply wit...
The Internet of Everything (IoE) brings together people, process, data and things to make networked connections more relevant and valuable than ever before – transforming information into knowledge and knowledge into wisdom. IoE creates new capabilities, richer experiences, and unprecedented opportunities to improve business and government operations, decision making and mission support capabilities.
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at @ThingsExpo, James Kirkland, Red Hat's Chief Architect for the Internet of Things and Intelligent Systems, described how to revolutionize your archit...
MuleSoft has announced the findings of its 2015 Connectivity Benchmark Report on the adoption and business impact of APIs. The findings suggest traditional businesses are quickly evolving into "composable enterprises" built out of hundreds of connected software services, applications and devices. Most are embracing the Internet of Things (IoT) and microservices technologies like Docker. A majority are integrating wearables, like smart watches, and more than half plan to generate revenue with APIs within the next year.
Growth hacking is common for startups to make unheard-of progress in building their business. Career Hacks can help Geek Girls and those who support them (yes, that's you too, Dad!) to excel in this typically male-dominated world. Get ready to learn the facts: Is there a bias against women in the tech / developer communities? Why are women 50% of the workforce, but hold only 24% of the STEM or IT positions? Some beginnings of what to do about it! In her Opening Keynote at 16th Cloud Expo, Sandy Carter, IBM General Manager Cloud Ecosystem and Developers, and a Social Business Evangelist, d...
In his keynote at 16th Cloud Expo, Rodney Rogers, CEO of Virtustream, discussed the evolution of the company from inception to its recent acquisition by EMC – including personal insights, lessons learned (and some WTF moments) along the way. Learn how Virtustream’s unique approach of combining the economics and elasticity of the consumer cloud model with proper performance, application automation and security into a platform became a breakout success with enterprise customers and a natural fit for the EMC Federation.
The Internet of Things is not only adding billions of sensors and billions of terabytes to the Internet. It is also forcing a fundamental change in the way we envision Information Technology. For the first time, more data is being created by devices at the edge of the Internet rather than from centralized systems. What does this mean for today's IT professional? In this Power Panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists addressed this very serious issue of profound change in the industry.
Discussions about cloud computing are evolving into discussions about enterprise IT in general. As enterprises increasingly migrate toward their own unique clouds, new issues such as the use of containers and microservices emerge to keep things interesting. In this Power Panel at 16th Cloud Expo, moderated by Conference Chair Roger Strukhoff, panelists addressed the state of cloud computing today, and what enterprise IT professionals need to know about how the latest topics and trends affect their organization.
It is one thing to build single industrial IoT applications, but what will it take to build the Smart Cities and truly society-changing applications of the future? The technology won’t be the problem, it will be the number of parties that need to work together and be aligned in their motivation to succeed. In his session at @ThingsExpo, Jason Mondanaro, Director, Product Management at Metanga, discussed how you can plan to cooperate, partner, and form lasting all-star teams to change the world and it starts with business models and monetization strategies.
Converging digital disruptions is creating a major sea change - Cisco calls this the Internet of Everything (IoE). IoE is the network connection of People, Process, Data and Things, fueled by Cloud, Mobile, Social, Analytics and Security, and it represents a $19Trillion value-at-stake over the next 10 years. In her keynote at @ThingsExpo, Manjula Talreja, VP of Cisco Consulting Services, discussed IoE and the enormous opportunities it provides to public and private firms alike. She will share what businesses must do to thrive in the IoE economy, citing examples from several industry sectors.
There will be 150 billion connected devices by 2020. New digital businesses have already disrupted value chains across every industry. APIs are at the center of the digital business. You need to understand what assets you have that can be exposed digitally, what their digital value chain is, and how to create an effective business model around that value chain to compete in this economy. No enterprise can be complacent and not engage in the digital economy. Learn how to be the disruptor and not the disruptee.
Akana has released Envision, an enhanced API analytics platform that helps enterprises mine critical insights across their digital eco-systems, understand their customers and partners and offer value-added personalized services. “In today’s digital economy, data-driven insights are proving to be a key differentiator for businesses. Understanding the data that is being tunneled through their APIs and how it can be used to optimize their business and operations is of paramount importance,” said Alistair Farquharson, CTO of Akana.
Business as usual for IT is evolving into a "Make or Buy" decision on a service-by-service conversation with input from the LOBs. How does your organization move forward with cloud? In his general session at 16th Cloud Expo, Paul Maravei, Regional Sales Manager, Hybrid Cloud and Managed Services at Cisco, discusses how Cisco and its partners offer a market-leading portfolio and ecosystem of cloud infrastructure and application services that allow you to uniquely and securely combine cloud business applications and services across multiple cloud delivery models.
The enterprise market will drive IoT device adoption over the next five years. In his session at @ThingsExpo, John Greenough, an analyst at BI Intelligence, division of Business Insider, analyzed how companies will adopt IoT products and the associated cost of adopting those products. John Greenough is the lead analyst covering the Internet of Things for BI Intelligence- Business Insider’s paid research service. Numerous IoT companies have cited his analysis of the IoT. Prior to joining BI Intelligence, he worked analyzing bank technology for Corporate Insight and The Clearing House Payment...
"Optimal Design is a technology integration and product development firm that specializes in connecting devices to the cloud," stated Joe Wascow, Co-Founder & CMO of Optimal Design, in this SYS-CON.tv interview at @ThingsExpo, held June 9-11, 2015, at the Javits Center in New York City.
SYS-CON Events announced today that CommVault has been named “Bronze Sponsor” of SYS-CON's 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. A singular vision – a belief in a better way to address current and future data management needs – guides CommVault in the development of Singular Information Management® solutions for high-performance data protection, universal availability and simplified management of data on complex storage networks. CommVault's exclusive single-platform architecture gives companies unp...
Electric Cloud and Arynga have announced a product integration partnership that will bring Continuous Delivery solutions to the automotive Internet-of-Things (IoT) market. The joint solution will help automotive manufacturers, OEMs and system integrators adopt DevOps automation and Continuous Delivery practices that reduce software build and release cycle times within the complex and specific parameters of embedded and IoT software systems.
"ciqada is a combined platform of hardware modules and server products that lets people take their existing devices or new devices and lets them be accessible over the Internet for their users," noted Geoff Engelstein of ciqada, a division of Mars International, in this SYS-CON.tv interview at @ThingsExpo, held June 9-11, 2015, at the Javits Center in New York City.
Internet of Things is moving from being a hype to a reality. Experts estimate that internet connected cars will grow to 152 million, while over 100 million internet connected wireless light bulbs and lamps will be operational by 2020. These and many other intriguing statistics highlight the importance of Internet powered devices and how market penetration is going to multiply many times over in the next few years.