Agrium increases and extends Royster-Clark offer

Release Date: 1/9/2006

CALGARY, Alberta -- Agrium Inc. (TSX and NYSE: AGU) announced today that it has increased its offer to purchase all outstanding Royster-Clark Income Depositary Securities (IDSs) to $11.00 (Canadian) cash per IDS, and as a result, has extended the expiry time of its bid until midnight (Vancouver time) on January 23, 2006. The increased offer price represents an allocation of $2.20 per Common Share forming part of the IDS and $8.80 for each Subordinated Note forming part of the IDS.  Agrium also has reduced its minimum tender condition to 66 2/3 percent, and has removed the due diligence condition. 

Agrium and Royster-Clark had previously reached an agreement that Royster-Clark’s rights plan would not apply to Agrium’s bid, therefore providing the opportunity for Royster-Clark unitholders to take full advantage of Agrium’s all cash offer.

Agrium will file and deliver a notice of extension and variation of its offer today.

“Royster-Clark’s Board has declined Agrium’s attempts to negotiate a friendly transaction,” said Mike Wilson, Agrium President and CEO.  “After more than two months, Royster-Clark has not presented an alternative for its investors.”

“We believe that Agrium’s enhanced offer is the best value available for unitholders. It fully reflects Royster-Clark’s recent financial estimates, which are consistent with Agrium’s expectations.  It also fully reflects the modest recovery of value by comparable trusts since the Canadian government’s tax policy announcement.”

Agrium Inc. is a leading global producer and marketer of agricultural nutrients and industrial products and a major retail supplier of agricultural products and services in both North and South America.  Agrium produces and markets three primary groups of nutrients: nitrogen, phosphate and potash as well as controlled release fertilizers and micronutrients. Agrium’s strategy is to grow through incremental expansion of its existing operations and acquisitions as well as the development, commercialization and marketing of new products and international opportunities.

This press release contains forward-looking statements.  Forward-looking statements are not based on historical facts, but rather on current expectations and projections about future events, and are therefore subject to risks and uncertainties which could cause actual results to differ materially from the future results expressed or implied by the forward-looking statements.  Such statements are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations.  These risk factors relative to this bid, include: realization of operational synergies, reliance on Royster-Clark Ltd.’s publicly available information which may not fully identify all risks related to their performance, success in integrating the retail distribution systems, and the integration of supply chain management processes, as well as other risk factors listed from time to time in Agrium’s reports, comprehensive public disclosure documents including the Annual Information Form, and in other filings with securities commissions in Canada (on SEDAR at www.sedar.com) and the United States (on EDGAR at www.sec.gov).

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