Activist investor TCI unveils plan to cut costs, boost service at CN
BNN Bloomberg
The activist investor pushing for change at Canadian National Railway Co. has outlined its plan to improve returns at Canada’s largest railway with a greater focus on efficiency under a new chief executive officer.
The activist investor pushing for change at Canadian National Railway Co. has outlined its plan to improve returns at Canada’s largest railway with a greater focus on efficiency under a new chief executive officer.
TCI Fund Management Ltd., which is run by billionaire Chris Hohn, spelled out in a presentation Monday how it believes Canadian National can improve its operations and culture and reduce costs. TCI argues in the 102-page document that it’s imperative for CN to make changes now after its smaller rival, Canadian Pacific Railway Ltd., agreed to acquire Kansas City Southern.
“CP will be a much stronger competitor, so CN needs to raise its game urgently to prepare for a tougher competitive environment,” TCI said in the presentation, a copy of which was reviewed by Bloomberg News.
TCI, which owns more than 5 per cent of Canadian National, argues that CN’s priority should be to expand the business. The firm said the railway needs to invest in its network and technology to create more capacity, improve fluidity and connect new customers to the railway.
The fund also says CN needs to aggressively market itself to customers as an environmentally friendlier alternative to trucks.
