[120317.EN.BIZ] Ex-CN, ex-CP CEO Hunter Harrison Named CSX Boss After Hedge Fund Drama

US south eastern railway CSX named ex-Canadian National (CN) and lately Canadian Pacific (CP) CEO Hunter Harrison, 72, as its chief executive bowing to pressure from activist hedge fund Mantle Ridge, Reuters reports.

CSX agreed to add Mr Harrison and Mantle Ridge founder Paul Hilal to the board, along with three new directors, taking the total size of the board to 13.

Mantle Ridge, which owns 4.9 per cent of CSX, was pressuring the company to sign Harrison for four years and for Harrison and Hilal to join CSX's board along with four new independent directors.

Mr Harrison, 72, will receive stock options to purchase nine million CSX shares at its current trading price, the company said.

CSX said its board would also seek a shareholder vote at the 2017 annual meeting on the payment of US$84 million in compensation and benefits forfeited by Mr Harrison as a result of his early departure from Canadian Pacific.

Mr Harrison replaces Michael Ward, who announced his decision to retire as CEO on February 21 after 14 years in the role, Forbes magazine reported.

Edward Kelly, the company's lead independent director on the board, will replace Ward as chairman and Mr Hilal will be named vice chairman of the board, CSX said in a statement.

Said Mr Harrison: "I am proud to join the dedicated and talented railroaders at CSX. Together, we will implement Precision Scheduled Railroading - a model proven to improve safety, create better service for customers, produce a proud and winning culture for employees, and generate exceptional, lasting value for shareholders."

Like Norfolk Southern, CSX is considered to be one of the least efficient railways in North America, with heavy exposure to troubled coal markets.

Source : HKSG.