Agrium Inc activist investor ValueAct happy to keep hands off and enjoy profits

Agrium Inc.\’s second go-around with a big U.S. activist investor goes a lot smoother than the first one.

When ValueAct Capital Management LP says it owned 5.7% of Agrium last October, some investors speculated it might push for aggressive change at the Calgary-based company. Agrium maintained which was not the case, and that ValueAct just thought the stock was cheap.

It works out the company was right.

The record date for voting at Agrium\’s annual meeting came and went now, and there wasn\’t a peep from ValueAct. The hedge fund appears to be happy with its Agrium investment, as well it should: The stock is up more than 20% since ValueAct built its position last fall.

\”They\’ve been the same as any other shareholder we\’ve had meetings with,\” said Richard Downey, Agrium\’s vice-president of investor relations. \”They\’re pleased with the direction of management over the last year.\”

Agrium knows about activist investors. In 2012, the agricultural giant waged a vicious 10-month proxy fight with New York-based Jana Partners LLP, which wanted to break apart the company\’s wholesale and retail sections. Agrium won the battle as none of Jana\’s nominees was elected to its board.

ValueAct, which manages about US$17-billion of investor funds, is larger and more influential than Jana. The San Francisco-based firm designed a major impact at companies such as Microsoft Corp. and Canada\’s Valeant Pharmaceuticals International Inc. But unlike the balance Ackmans and Carl Icahns of the world, it tends to work quietly with boards and management teams to push for change.


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