The search for a new executive at the Canadian National Railway Company (CN) takes a new turn: a candidate approached to take the helm of the Montreal company withdraws from the race – a decision that surprises analysts and investors.
According to the largest railroad in the country, Jim Vena would have announced his decision on Sunday evening. This industry veteran was the choice of TCI Fund Management, CN’s second largest shareholder (5.2%) and involved in a standoff with the company since the spring.
The London fund had not commented on the turn of events on Monday. TCI has called for a special meeting on March 22 to replace 4 of CN’s 11 directors with nominees it has chosen.
This announcement set back the action of the rail carrier. On the Toronto Stock Exchange on Monday morning, the stock dropped 6%, or $ 9.80, to trade at $ 154.33.
Athony Hatch, of ABH Consulting in New York City, didn’t expect Mr. Vena to walk away from the process, about three months away from an important shareholder meeting.
The analyst essentially anticipated two scenarios: whether the TCI candidate would be successful or whether CN opted for someone else who would have had time to prove himself before March 22.
“What I did not expect is that it is not Mr. Vena and it is still unknown who will be the next leader,” he explained, during a telephone interview.
In a statement, CN said it expected to “close the process” and announce the name of the person who will succeed Jean-Jacques Ruest next January.
The railway is subject to the Official Languages Act. So far, he has declined to say whether fluency in French will be taken into account in the assessment of his candidates.
Mr. Ruest is bilingual.