CN calls special shareholder meeting in response to request from TCI

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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.

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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.”

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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.

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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.

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