Newspaper article The Canadian Press

Institutional Investors Backing Pershing in CP Fight, Poll Suggests: Big CP Investors Backing Pershing: Poll

Newspaper article The Canadian Press

Institutional Investors Backing Pershing in CP Fight, Poll Suggests: Big CP Investors Backing Pershing: Poll

Article excerpt

Three-quarters of Canadian Pacific Railway Ltd.'s (TSX:CP) institutional shareholders are backing a New York hedge fund's push to install veteran railroader Hunter Harrison as CEO of the railway, a poll by an investor advisory firm suggests.

Brendan Wood International said Thursday that 75 per cent of the institutional shareholders it polled support Pershing Square Capital Management's plan to replace Canadian Pacific chief executive Fred Green.

The latest poll results, which included shareholders owning around 45 per cent of Canadian Pacific's shares, were roughly in line with a survey last month by Brendan Wood that included shareholders holding about a third.

"You're getting very similar numbers. They're moving, I would say, in Pershing's favour a little bit, but they are already quite strong in their favour," said Stewart Borden, a partner at Brendan Wood.

Bill Ackman's Pershing Square wants former Canadian National chief executive Hunter Harrison to take over the top job at Canadian Pacific. The investment firm is also seeking to install seven nominees on the 15-member Canadian Pacific board at the railway's annual meeting next month.

The poll found that 19 per cent of the institutional investors surveyed supported change at Canadian Pacific, but not Harrison. Just six per cent backed the Canadian Pacific board.

The survey was completed April 17, before Canadian Pacific released its first-quarter results, but after the railway previewed its earnings by saying it expected a profit in the range of 80 to 83 cents per share.

Since the poll was conducted, Canadian Pacific reported a profit of 82 cents per share and a sharply improved operating ratio. It has also raised its quarterly dividend to 35 cents per share from 30 cents.

Canadian Pacific questioned the validity of the poll, which did not include retail investors. …

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