UPDATE 1-Riskmetrics: CF holders should back Agrium bid

* Proxy firm Riskmetrics backs Agrium bid

* Says offer "compelling enough" for talks

By Michael Erman

NEW YORK, Nov 16 (Reuters) - Proxy advisor Riskmetrics Group said on Monday that shareholders of CF Industries Holdings Inc (CF.N) should tender their shares into Agrium Inc's (AGU.TO) hostile bid for CF, saying the offer is "compelling enough to at least earn a seat at the negotiation table."

Canada's Agrium launched its hostile bid for fertilizer maker CF in February, after CF itself had launched its own bid for smaller rival Terra Industries Inc TRA.N in January.

Riskmetrics backed CF Industries last week in its bid to put a slate of three directors up for election to Terra's board. If CF is successful in that tactic it would substantially improve its chances of buying Terra.

Agrium's bid is contingent on CF dropping its bid for Terra.

Riskmetrics raised doubts that CF's board will fairly evaluate the Agrium bid, saying the company "deserves less deference than the typical hostile target."

These concerns, the firm said, made it "more comfortable recommending CF shareholders tender their shares to Agrium despite a less than 'blow out' offer value."

Agrium's tender offer for CF expires on Nov. 18.

"If CF refuses to act, Agrium will consider all options, including nominating a slate of directors to the CF board and pursuing litigation," Agrium Chief Executive Officer Mike Wilson said in a statement.

In response to the Riskmetrics report, CF Industries said in a statement that it "continues to believe that Agrium has failed to make a compelling offer."

Agrium is offering $45 in cash and one common share of Agrium for each CF share.

Terra shareholders are scheduled to vote on the board nominees at the company's annual meeting on Nov. 20. (Reporting by Michael Erman; editing by Carol Bishopric)