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Activist investor confirms taking 2.8 million shares in Canadian Pacific

Ackman previously owned nearly 10 million shares of CP until 2016

A Canadian Pacific train. (Photo: Canadian Pacific)

Pershing Square Capital Management, a New York-based hedge fund founded by CEO Bill Ackman, had acquired 2.8 million shares of Canadian Pacific, with a value of $202.4 million, by the end of 2021, according to a Monday 13F filing with the U.S. Securities and Exchange Commission.

Pershing Square had omitted the share acquisition from a Feb. 14 filing following a request for confidential treatment, which was subsequently withdrawn Friday. A media report Monday said Ackman has invested even more into CP since December, with an economic exposure value of about $1.2 billion.

Pershing Square’s share acquisition of CP comes as the railway is seeking to obtain federal approval to acquire Kansas City Southern. Shareholders of CP and KCS approved the $31 billion merger last December and now the Surface Transportation Board is reviewing the deal, which would create the first transcontinental railroad between Canada, the U.S. and Mexico.

Activist investor Ackman previously owned shares of CP (NYSE: CP) but gave them up in August 2016 in order to use the proceeds of the sale to fund new investments. At that time, Pershing Square offered 9.8 million shares of CP. Ackman continued to serve on CP’s board of directors for several months afterward.

“Canadian Pacific has completed an incredible transformation since our initial investment in 2011,” Ackman said in August 2016. “Hunter Harrison and Keith Creel have restored to greatness one of North America’s top railroads and have set the company on the path to continued success.”

According to a Monday Bloomberg article, Ackman installed the late Harrison as its CEO while he was on CP’s board of directors. Ackman’s tenure on the board of directors included a proxy fight that resulted in the installation of Harrison and several new board members nominated by Ackman.

The Bloomberg article also said Ackman has invested more into CP since December, with an economic exposure value at an estimated $1.2 billion in stocks and forward contracts.  

The Bloomberg article also quotes Ackman as congratulating CP’s performance under Creel’s leadership. Creel is currently president and CEO of CP. 

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Joanna Marsh

Joanna is a Washington, DC-based writer covering the freight railroad industry. She has worked for Argus Media as a contributing reporter for Argus Rail Business and as a market reporter for Argus Coal Daily.