CF Shareholders Back 3 Directors Amid 3-Way Takeover Tussle

   DOW JONES NEWSWIRES 
 

Three CF Industries Holdings Inc. (CF) directors up for re-election were backed at the company's annual board meeting, signaling an endorsement of the fertilizer company's direction during an ongoing three-way battle in the sector.

The jockeying for position comes as fertilizer producers look to take advantage of the drop in sector stock prices since last summer to buy up production capacity ahead of an expected rebound in prices.

On Tuesday, CF Chief Executive Stephen Wilson reiterated his commitment to acquiring rival Terra Industries Inc. (TRA) and the company's effort to rebuff Agrium Inc.'s (AGU) takeover bid.

On top of its effort to sweeten its $3.07 billion bid for Terra, CF has been on the defensive as rival Agrium last month boosted the cash portion of its $3.6 billion offer for CF. Agrium has been actively looking to build shareholder backing for the takeover while CF has continually urged that holders reject Agrium's bid, saying the deal was "grossly inadequate."

Agrium, the largest of the three companies by revenue, had urged CF shareholders to withhold their votes on the election of directors and tender their shares to Agrium's exchange offer "to send a clear message to the CF board." Agrium launched an exchange offer to CF shareholders last month, which is set to expire at May 19, and on Tuesday reaffirmed its plans to acquire CF.

Last week, CF said a proxy advisory firm had recommended that CF's shareholders vote for its three board members to remain on the board. The board results follow a preliminary vote count announced by CF.

Terra, meanwhile, has rejected a takeover offer from CF three times. Terra Chairman Henry Slack and Chief Executive Michael Bennett said the latest $30.50-per-share bid, offered in late March, "substantially undervalues" the company and would deliver less value than Terra would achieve independently. In response, CF launched a proxy contest to replace three Terra directors at its annual meeting, which had been scheduled for May but was delayed by Terra.

CF's shares were up 1.5% to $68.33 in recent trading, as Agrium's shares rose 0.9% to $39.35. Terra's shares rose 0.4% to $27.32.

-By John Kell, Dow Jones Newswires, 201-938-5285, [e-mail]