Friday, July 27, 2012
Hunter Harrison makes comeback at a cost to CP
The former chief of Canada's largest Class One railroad has assumed the throne of the North American nation's second largest, but it has reportedly come at a cost.
Hunter Harrison, once the chief executive of the Canadian National, is now CEO of the Canadian Pacific Railway at a charge of $38 million, the Globe & Mail reports.
Harrison replaced former CP chief, Fred Green, after a bitter proxy battle instigated by board member Bill Ackman, CEO of Pershing Square Capital Management LP, who said back in January that he would guarantee Harrison's retirement benefits if his former company won a legal complaint over that issue.
The CP's second quarter profit fell 20 percent, including the $38 million charge.
"Included in this charge were amounts totaling $16-million in respect of deferred retirement compensation for Mr. Harrison and $20-million which was payable at June 30, 2012, to Pershing Square Capital Management LP and related entities," the CP said.
"The amount payable to Pershing Square and related entities was to reimburse them, on behalf of Mr. Harrison, for certain amounts they had previously paid to or incurred on behalf of Mr. Harrison pursuant to an indemnity in favor of Mr. Harrison," the railroad said
The CP also agreed to indemnify Harrison for up to $3-million in legal costs in addition to granting him stock options and deferred share units valued at $12-million.
For the full Globe & Mail story: theglobeandmail.com
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