LONDON — Activist investor TCI Fund Management has formally requested a special meeting of Canadian National’s shareholders and named four individuals it will nominate for the railroad’s board of directors.
“We did not seek a proxy fight,” Chris Hohn, TCI founder and managing partner, said in a Monday press release, “but without urgent action CN’s operational and financial performance will continue to lag its peers under a board that lacks the right railroad experience and operational expertise.”
CN has acknowleged the TCI request but has yet to receive the formal requisition. The railroad said that once it does, it will review it and comment further “in due course.”
Hohn has previously called for changes to the board, including replacement of chairman Robert Pace, as well as CEO JJ Ruest, in light of CN’s pursuit of Kansas City Southern, which appears doomed after the Surface Transportation Board denied the CN-KCS request for use of a voting trust [see “Major CN investor calls for ouster of CEO and chairman …,” Trains News Wire, Aug. 31, 2021].
At that time, TCI — CN’s second-largest investor — indicated former CN Chief Operating Officer Jim Vena would be its choice for CEO and that it would nominate former Illinois Central board member and CN board member Gilbert Lamphere for the board.
On Monday, Hohn identified three other board candidates:
— Allison Landry, a former transportation analyst at Credit Suisse who is currently a board member of XPO Logistics, a less-than-truckload carrier and truck brokerage provider.
— Rob Knight, who was chief financial officer at Union Pacific for 15 years before retiring in 2019. He spent 40 years at UP; previous executive positions included time as general manager of the railroad’s energy and automotive business units.
— Paul Miller, a Canadian Nation executive from 1978 to 2011, retiring as vice president of safety, sustainability, and network transportation. Most recently, he has been a consultant and a professor at the Canadian Rail Research Laboratory.
TCI will seek to remove four current board members — Pace, Kevin Lynch, James O’Connor, and Laura Stein — to make room for its nominees.
TCI had previously indicated it would seek to nominate at least five new board members, and reported it had hired Kingsdale Advisors to assist in a possible proxy fight [see “Activist investor plans to call for meeting …,” Trains News Wire, Sept. 7, 2021].
Kansas City Southern has subsequently returned to Canadian Pacific as its preferred merger partner, accepting CP’s latest offer on Sunday [see “Kansas City Southern accepts Canadian Pacific merger offer,” News Wire, Sept. 12, 2021].
— Previous version expanded and replaced at 6:20 p.m. CDT
BUT are they throwing out the baby with the bathwater? Is Vena really the right guy to replace Ruest, and should Ruest even be replaced? He has done an excellent job, and I doubt the failed merger attempt with KCU was his idea alone.
YES!
CN trying to take KCS from CP really backfired and now cost them their jobs. Greed…. Hate to see it!
Oh, so seldom in recent years have we had anything to celebrate in this world as it spins out of control. Here’s one we can be glad for.