Newspaper article The Canadian Press

Canadian Pacific Taps Former Rival Hunter Harrison as New Chief Executive

Newspaper article The Canadian Press

Canadian Pacific Taps Former Rival Hunter Harrison as New Chief Executive

Article excerpt

Hunter Harrison confirmed as new CEO of CP

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CALGARY - Canadian Pacific Railway named Hunter Harrison as its new president and chief executive officer on Friday, drawing the long-time railroader come out of retirement to lead what was once his biggest rival.

Harrison, 67, is the former CEO of Canadian National Railway (TSX:CNR) and is credited with turning CN into one of North America's most successful railways -- a track record lauded by Canadian Pacific's (TSX:CP) largest shareholder in its push for change at the top.

"I know you, your colleagues, and the company have been through unsettling times lately. Let me assure you, I recognize great potential lies within CP," Harrison said in a letter to employees, obtained by The Canadian Press.

"I am completely committed to working with you to build a stronger CP. Change is never easy. But we will get better at what we do for our customers, our colleagues and families, and to drive shareholder value."

New York hedge fund Pershing Square Capital Management became the largest shareholder of Canadian Pacific last year, touching off a bitter months-long battle that resulted in the departure of the railway's chief executive, its chairman and several directors.

Pershing Square CEO Bill Ackman placed the blame for the railway's underperformance squarely on then-CEO Fred Green.

The appointment of Harrison, who was Ackman's preferred candidate to replace Green and had expressed no reservations about returning to the corporate world, was widely expected.

Paul Haggis, who became CP chairman after the departure of John Cleghorn, said the new board appointed Harrison after a thorough selection process. The railway said he has been given a four-year contract.

"The board welcomes Mr. Harrison's experience and leadership to CP. We look forward to benefiting from his strong track record of service reliability, efficient asset utilization and strategic capital expenditure," Haggis said in a statement.

In his letter to staff, Harrison said there's no "magic formula" for fixing the railway.

"It will come down to a mix of the strengths of the railway and CP people working hard to execute the plan for service excellence. …

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