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Jan 25, 2022

CN Rail names Tracy Robinson CEO, settles with activist TCI

CN Rail appoints Tracy Robinson as new CEO effective Feb. 28


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Canadian National Railway Co. named Tracy Robinson as its new chief executive officer and settled a dispute with shareholder TCI Fund Management Ltd., ending a long period of uncertainty over the leadership of one of North America’s largest railroads. 

Robinson immediately becomes one of the most prominent female executives in corporate Canada, the first woman to run the Montreal-based company. She spent 27 years at rival Canadian Pacific Railway Ltd. and has been at Calgary’s TC Energy Corp. since 2014, where she has been in charge of its Canadian natural gas pipelines.

The country’s largest railway said it will grant TCI two seats on the board as part of a settlement that prevents a proxy fight, confirming an earlier report by Bloomberg News. The directors will be named at a future date. 

“This is a transformational period at CN, and I couldn’t be more excited about the opportunities ahead,” Robinson said in a statement. “Our focus is on building the railway of the future -- one that creates shareholder value by meeting the needs of our customers, employees, communities, and the economies that depend on us, safely, reliably, and efficiently.”


Departing CEO Jean-Jacques Ruest said Robinson’s knowledge of the energy sector will help the railway take advantage of transporting things like blue hydrogen to export.

“She knows the railroad, she knows the network, she knows the competition, she knows CN and she’s passionate about railroading,” Ruest said on an earnings call Tuesday afternoon. “In my view she’s a railroader and she’s not really from outside.”

At TC Energy, Robinson was also president of Coastal GasLink, a $6.7 billion (US$5.3 billion) under-construction natural gas pipeline to connect natural gas fields in Western Canada with the country’s first LNG export project.


Canadian National made a US$30 billion takeover offer for Kansas City Southern last year, trying to snatch it away from Canadian Pacific. The effort collapsed when U.S. regulators blocked a key provision in the proposed deal, but it still succeeded in forcing CP to pay billions more to win the prize. 

The takeover play fueled TCI’s decision to try to force out Ruest and change the board. The investment firm said the bid was doomed to fail and exposed Canadian National to unacceptable financial risk. Ruest announced his retirement in October. 

TCI, which is run by billionaire Chris Hohn and is CN’s second-largest holder, had been pushing for four board seats. The settlement means shareholders won’t be voting on its nominees at a shareholder meeting that had been called for March 22.

“We are pleased to reach an arrangement that will strengthen CN’s Board with the addition of two new highly qualified directors,” Hohn said in a statement. TCI owns 5.2 per cent of Canadian National, according to data compiled by Bloomberg. Bill Gates’s Cascade Investment LLC is the largest shareholder with 9.8 per cent. 

Former Quebec Premier Jean Charest is also joining the railway’s board, though not as a TCI nominee. 

Canadian National beat expectations for its fourth quarter earnings Tuesday, making $1.71 per share on an adjusted basis. Analysts expected $1.53.

The railway was hit by flooding in British Columbia in the fourth quarter, which temporarily cut rail access to Canada’s biggest port. The disruption came during one of the busiest times for grain shipping and as global supply chains are already strained with congestion and backlogs.