Chris Goodney/Bloomberg News
CSX Corp. has extended the deadline two weeks to nominate board members in a move that allows a private hedge fund to continue negotiations with the railroad company to install former Canadian Pacific CEO Hunter Harrison atop the rival railroad.
The Jacksonville, Florida-based company moved the deadline to Feb. 24, according to a press release issued hours before the Feb. 10 deadline was due to expire.
Paul Hilal, who runs the hedge fund Mantle Ridge LP, is pushing CSX to replace current CEO Michael Ward. Harrison, 72, resigned from Canadian Pacific after signing a deal to work with Hilal. The Wall Street Journal reported that Hilal is also trying to win several new board seats.
Industry consultant Anthony Hatch told Transport Topics that Harrison would help CSX improve its operating ratio using a concept called “precision railroading,” a strategy to run fewer trains to prioritize on-time deliveries and improve the efficiency of the railcars and locomotives.
“I cannot find a reason why this ultimately won’t be a successful effort,” he said. “I’ve never met an operational guy who doesn’t think that Hunter’s energy, the change he brings, and precision railroading won’t make things more productive [at CSX].”
Hatch added in a Feb. 10 note to railroad industry veterans and industry analysts that some believe the East Coast railroads need Harrison’s presence immediately.
|By Transport Topics
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