Investor Seeks to Name 4 to CN Board

An activist hedge fund had requested a special meeting of the shareholders of Canadian National in an effort to shake up the board of director’s composition.

TCI Fund Management has named four individuals it will nominate for the railroad’s board of directors.

“We did not seek a proxy fight 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,” said Chris Hohn, TCI founder and managing partner in a statement.

CN said in its own statement that it knows about 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.

Hohn has called for replacing CN Chairman Robert Pace and ousting CEO J.J. Ruest. He also wants CN to drop its bid to acquire Kansas City Southern.

CN is CN’s second-largest investor. It has proposed naming to the CN board Allison Landry, a former transportation analyst at Credit Suisse who is currently a board member of XPO Logistics;  Rob Knight, who was chief financial officer at Union Pacific for 15 years before retiring in 2019; Paul Miller, a Canadian Nation executive from 1978 to 2011, retiring as vice president of safety, sustainability, and network transportation;  and Gilbert Lamphere, a former CN and Illinois Central board member.

They would replace current board members Pace, Kevin Lynch, James O’Connor, and Laura Stein.

Hedge Fund Pressing Effort to Oust Top CN Management

An activist hedge fund that controls more than 5 percent of stock in Canadian National said it will press other investors to support a call to replace the railroad’s top management.

A partner in TCI Fund Management told a Toronto newspaper that his firm has been speaking with other large investors who are likewise disenchanted with CN management.

TCI began demanding the resignation of CN CEO J.J. Ruest and Chairman Robert Pace after the U.S. Surface Transportation Board rejected a plan by CN to place Kansas City Southern into a voting trust as a first step toward acquiring KCS.

Walker told the Globe and Mail that the next steps toward replacing Ruest and Pace will hinge on what other shareholders do.

TCI is the second-largest CN stockholder and also holds a large share of stock in Canadian Pacific.

Pace Re-Elected as CN Chairman

The board of directors of Canadian National re-elected Robert Pace as chairman during the annual shareholders meeting held April 28 via webcast.

Pace, who is president and chief executive officer of The Pace Group in Halifax, Nova Scotia, has served as CN’s chairman since 2014.

Also elected to serve on CN’s board were Shauneen Bruder, Donald Carty, Gordon Giffin, Julie Godin, Edith Holiday, V. Maureen Kempston Darkes, Denis Losier, Kevin Lynch, James O’Connor, Robert Phillips, CN President and CEO Jean-Jacques Ruest, and Laura Stein.