- Signs for push-out forces
- After almost five years on the job
- Praise and thanks for Harrison
- Keith Creel taking over
(management-change.com) — Calgary, Alberta, Canada, January 19, 2017 — Hunter Harrison, chief executive of Canadian Pacific Railway, leaves. It is an abrupt change. As announced by Canadian Pacific Railway Limited in a news release on Wednesday, January 18, 2017, Hunter Harrison leaves the post as Chief Executive Officer at the transcontinental railway in Canada and the United States in a surprising move after almost five years on the job, effective immediately.
Harrison’s duties are taken over by Keith Creel, most recently President and Chief Operating Officer at Canadian Pacific Railway Limited.
Harrison steps down as CEO of Canadian Pacific Railway five months ahead of schedule.
The move is a generational change as well. Keith Creel is about 25 years younger than Hunter Harrison.
“Pursue opportunities involving other Class 1 Railroads”
The sudden management change is explained as follows. Canadian Pacific Railway said: “Mr. Harrison had approached the Board to discuss his retirement from CP and potential related modifications to his employment arrangements that would allow him to pursue opportunities involving other Class 1 Railroads. A special committee of the Board oversaw discussions with Mr. Harrison. Following negotiations, receipt of independent legal advice, and careful deliberation, the special committee recommended to the Board that CP enter into a separation agreement with Mr. Harrison.”
Teaming up with activist investor Paul Hilal to target CSX
On January 19, 2017, Bloomberg reported that Hunter Harrison is teaming up with activist investor Paul Hilal to target CSX Corp., citing a person familiar with the matter.
The CSX effort planned by Harrison and Hilal was reported earlier by the Wall Street Journal.
Hilal worked for years with billionaire hedge fund manager Bill Ackman before starting his own fund.
Canadian Pacific Railway said: “Creel will become President and Chief Executive Officer of the company effective January 31, 2017 following E. Hunter Harrison’s decision to retire from CP.”
Precise information about the future plans of Harrison was not immediately available.
Share price decline
The change follows a decline in the share price of Canadian Pacific Railway Limited since September 2014.
Royal Bank of Canada holds 4.69 percent stake
Royal Bank of Canada reported a 4.69 percent stake in Canadian Pacific Railway Limited as of September 30, 2016.
Chaired by Andrew F. Reardon
Canadian Pacific Railway Limited is chaired by Andrew F. Reardon.
Andrew F. Reardon was elected Chairman of the Board on July 21, 2015.
On the job as CEO since 2012
Harrison has been the Chief Executive Officer of Canadian Pacific Railway Limited and Canadian Pacific Railway Company since June 28, 2012.
Harrison joined CP in 2012.
Harrison served as President and Chief Executive Officer at Canadian National Railway Company (CN) from 2003-2009 and as the Executive Vice President and Chief Operating Officer from 1998-2002.
He served on CN’s Board of Directors for 10 years.
Prior to joining CN, Harrison was President and CEO at Illinois Central Corporation (IC), and Illinois Central Rail Road Company (ICRR) from 1993-1998, during which time he was also a member of the Board.
Harrison held various positions throughout his time at IC and ICRR, including Vice-President, COO and Senior VP of Operations.
Before his time at IC and ICRR in 1989, Harrison served as Burlington Northern’s Vice-President of Transportation and Vice-President of Service Design.
Harrison has served as a director on several railway companies and industry associations, including The Belt Railway of Chicago, Wabash National Corporation, The American Association of Railroads, Terminal Railway, TTX Company, CN, IC, and ICRR.
Harrison was named 2015 Railroader of the Year by railroad industry trade journal Railway Age. This is the second time he has been so-honored; the first time was in 2002, when he was chief operating officer of the then-recently combined Canadian National/Illinois Central system.
Harrison will take vacation leave effective immediately until January 31, 2017, and Creel will assume the CEO’s responsibilities during this period.
Signs for push-out forces
It is not completely certain what forces eventually triggered Hunter Harrison’s move.
The Push-out Score™ determined by management-change.com suggests that push-out forces may have contributed to the management change.
Read the full story in the management-change.com report 04.2017 ($).