Canadian National Railway Company has called a special shareholders meeting on March 22 in response to a request from an active investor unhappy with CN’s bid for Kansas City Southern.
British-based TCI Fund Management Ltd is calling for a change in the railways’ board of directors and the replacement of CN’s chief executive Jean-Jacques Rouest.
Montreal-based CN says it remains focused on advancing its growth and value creation strategy, despite “TCI’s unreasonable efforts to seize effective control of the company.”
CN says it has already added three new independent directors and achieved gender parity among independent directors ahead of the plan. It also received a US$700 million break fee after dropping its bid for KCS, which has agreed to merge with Canadian Pacific Railway Limited instead.
TCI called a shareholder meeting with the aim of “refreshing” the railways’ board by adding the four members it has nominated. It has also proposed former CN chief operating officer Jim Vena as a possible replacement for Ruest.
CN says TCI is in conflict of interest because it owns five percent of the railways, but is also the largest shareholder of Calgary-based CP Rail.