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Agrium CEO Michael Wilson.TODD KOROL/Reuters

The battle between Agrium Inc. and activist investor Jana Partners LLC heated up Monday, even as it came to light that the two sides recently discussed a truce.

Calgary-based Agrium announced that it has added two new directors to its board, and also revealed that it had reached out to Jana ahead of doing so to determine whether it could find a way to end the New York-based hedge fund's proxy battle.

Three days of talks ensued, during which Agrium sought an agreement from Jana to back off of its attempts to force a breakup of the company in return for allowing Jana to name one director nominee to Agrium's board, Agrium said.

"After agreeing, at the last minute, Jana reneged and insisted on two director nominees," Agrium said. "As a result, discussions terminated."

The two new directors are David Everitt, who recently retired as an executive at Deere & Co., and Mayo Schmidt, who was CEO of Viterra Inc., which was acquired by Glencore International late last year.

Agrium also said it has met with a large number of its shareholders and that they "overwhelmingly" support its strategy, which includes staying intact as an integrated company.

Jana quickly issued its own press release, saying it takes issue with Agrium's version of the talks that took place.

"In recent days, Agrium approached Jana seeking a settlement and indicated that the company had identified new director candidates who would address the Agrium board's deficiencies in experience and that Agrium would commit to addressing the performance issues raised by Jana," Jana said. "However, Agrium then refused to commit itself to addressing any of the performance issues identified by Jana, and also revealed the names of new directors who Jana believes are insufficient to address the Agrium board's deficiencies."

Jana characterized Agrium's appointment of the two new directors as a "hollow attempt to fight off real value-maximizing change," alleging the company chose individuals who would embrace "an unquestioned status quo, despite the clear opportunities for value creation that shareholders have rallied around."

Jana, which has successfully pushed for change at companies such as McGraw-Hill Cos., began turning up the heat on Agrium last summer and has been locked in a battle with the company ever since. It is the company's largest shareholder, holding more than 5  per cent of its stock.