Activist Plantro pushes for board overhaul at Ag Growth

An activist investor is pressing for a board shakeup at Ag Growth International, citing what it calls a severe governance breakdown following a regulatory cease-trade order and the departure of the company’s chief executive officer last week.

Plantro Ltd., which says it holds about 5% of the Canadian grain-handling and farm-equipment maker, has sent two letters to the company’s chair urging directors to reconstitute the board before recruiting a new CEO, reduce leverage and work with Plantro to identify new candidates for independent directors, according to people with knowledge of the matter.

Ag Growth has been under pressure since late last year, when it withdrew financial guidance and delayed results tied to issues in its Brazilian operations, prompting Canadian securities regulators to order management not to trade in the stock. The company released its overdue results in January and the CEO stepped down days later, but Plantro viewed the move as insufficient.

“A cease-trade order is an extreme governance failure and should result in the removal of the CEO and immediate board change,” a Plantro spokesperson said in a statement Thursday.

Ag Growth didn’t reply to requests for comment.

Ag Growth has previously attracted takeover interest. In 2024, it turned down acquisition approaches valued at about C$80 a share, the Globe and Mail newspaper reported, when the stock had strong institutional and hedge-fund backing. Since then, rising interest rates, operational challenges and a more opaque financial structure around its Brazil business have weighed on investor confidence.

Plantro is seeking a significant board reconstitution, preferably through a collaborative process, according to the people, who asked not to be identified because the information wasn’t public. If talks break down, the firm is prepared to ask for a special shareholder meeting to nominate its own slate of directors, the people said.

The activist’s latest campaign follows recent high-profile interventions elsewhere in Canada. At Information Services Corp., Plantro withdrew a board requisition after the company launched a sale process, with the share price roughly doubling since Plantro offered to buy more of the firm in April. At Calian Group Ltd., Plantro reached a cooperation agreement that led to a CEO retirement, with the stock rising afterward.

Plantro is also in a protracted dispute with Dye & Durham Ltd., which itself has been subject to a series of cease-trade orders since October due to late financial filings.

— By Paula Sambo (Bloomberg)