Hedge fund buys online ads to back Harrison as CSX chief executive

At issue: Advisory vote on $84 million reimbursement request
RELATED TOPICS: CSX | EHH | PEOPLE | FINANCIALS
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NEW YORK — Coming soon to a browser near you: Google ads urging CSX shareholders to vote to retain new CEO E. Hunter Harrison.

Mantle Ridge, the activist investor that successfully pursued the management shakeup at CSX Transportation, reported the ad buy in a regulatory filing on Friday, May 5.

The five ads all ask CSX shareholders to vote “yes” on a non-binding resolution to have CSX reimburse Mantle Ridge and Harrison $84 million for the salary and benefits Harrison forfeited by leaving early from the top job at Canadian Pacific.

Harrison left CP on Jan. 18, five months ahead of schedule, so he could aim for the executive suite at CSX. He became CSX’s chief executive on March 6 but says he’ll quit if shareholders don’t approve the reimbursement request.

CSX Transportation shareholders are widely expected to approve the measure at the annual general meeting, scheduled for June 5 in Richmond, Va. The reimbursement would cost about 12 cents per share, while CSX’s share price has risen by nearly 40 percent — or about $15 — since Jan. 18.

Mantle Ridge is placing five separate ads, all of which link to its CSXAdvisoryVote2017.com website.

The ad text includes:
• Your vote is crucial to ensure Hunter Harrison remains CEO of CSX. Vote Gold!
• Mantle Ridge encourages a vote FOR the Advisory Resolution on Reimbursement.
• Hunter Harrison is a legendary railroad executive who will transform CSX.
• Mantle Ridge encourages CSX shareholders to Vote Gold so Mr. Harrison remains CEO.
• Mr. Harrison will resign as CEO if the reimbursement resolution is not passed.

Gold refers to the color of the proxy card for yes votes.

The reimbursement request has stirred some activist opposition. Lawyer John P. Fishwick Jr. — whose father led Norfolk & Western Railway from 1970 to 1981 — has launched a one-man campaign against the reimbursement.

Fishwick, a former federal prosecutor who calls the reimbursement proposal “a horrific example of corporate waste,” created a Facebook page, Stop the CSX Train Robbery, to promote his cause.

NEWSWIRETrains News Wire

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