CP activist shareholder will host meeting in Toronto
William Ackman's Pershing Square Capital Management will make its case to shareholders for a new CEO at Canadian Pacific Railway (CP-T) at a meeting on February 6 in Toronto, according to a person familiar with the fund's plans.
Pershing, which holds 14.2 percent of CP's shares, is in the midst of a proxy battle to replace Chief Executive Fred Green with Hunter Harrison, best known for engineering a turnaround at rival Canadian National Railway (CNR-T).
Relations between Ackman and the board turned public and hostile early in January, and CP Chairman John Cleghorn has said repeatedly that the board will not support Ackman's plan.
Ackman will have to persuade shareholders to vote him and Pershing's four other nominees on to the board at CP's May 17 annual meeting of shareholders. If elected, the new directors will also need to win over at least part of the rest of the 15-member board.
The news came one day after CP reported higher profits but also said its operating ratio worsened to 78.5 percent in the fourth quarter, from 77 percent in the year-earlier period. The higher the ratio, which measures operating costs as a percentage of revenue, the less efficient the railway.