CEO hopeful vows to shake up Canadian Pacific
By Allison Martell and Pav Jordan
TORONTO (Reuters) - Hunter Harrison, the former railroad boss that an activist investor wants to take charge of Canadian Pacific Railway (CP.TO: Quote), said on Monday CP has to transform its complacent company culture if it wants to improve its lagging operating performance.
At a town hall-style meeting hosted by William Ackman's Pershing Square Capital Management in support of his proxy battle with CP, Harrison said he has invested $5 million of his own money in Canada's No. 2 railway. He said the investment showed he was confident in his ability to make CP click.
"Ninety percent of this is about people," Harrison told a packed ballroom at a Toronto hotel, where an audience of about 300 investors, lawyers and journalists took in more than two hours of presentations and questions.
"It's a wonderful franchise that's got a lot of potential and a lot of opportunity. The problem is execution, and we've just got to get to a point where we can make the cultural shifts that need to be made to get the railroad to execute like it should be," said Harrison in his Southern drawl.
Pershing is pushing Harrison, credited with turning around rival Canadian National Railway (CNR.TO: Quote) during his tenures as operating chief and CEO, as a remedy for CP's worst-in-class efficiency levels.
The closely watched New York hedge fund holds a 14.2 percent stake in the railway. It called the Toronto meeting, branded "CP Rising," to promote Harrison as well as its minority slate of nominees for CP's board.
CP said in a statement after the meeting that Pershing Square "continues to offer no plan or clear timetable to improve CP's operations, or even any concrete suggestions." It repeated that it was sticking to its own multi-year plan for improving performance under Fred Green, the current CEO.