Ontario Teachers’ Pension Plan, Toronto, will vote for William Ackman’s slate of directors for Canadian Pacific Railway’s board as he pushes to oust railway CEO Fred Green.
The C$117.1 billion (US$118 billion) pension plan is voting for Mr. Ackman’s seven nominees and withholding votes for the rest of what will be a 16-member board, according to the OTPP’s website. It held 1.3% of the stock as of March 31 and was the 14th-biggest investor, based on data compiled by Bloomberg.
Mr. Ackman, whose Pershing Square Capital Management is Canadian Pacific’s biggest shareholder, has said his slate of directors will seek a leadership change to boost profitability at North America’s least-efficient major railroad. Canadian Pacific’s board is supporting Mr. Green, who became CEO in 2006.
Ontario Teachers’ announcement bolsters Mr. Ackman’s case after proxy advisory firm Institutional Shareholder Services recommended last week that investors vote for his slate.
An April survey of about 45% of the railway’s shareholders from Brendan Wood International showed that about 94% of those polled want change at the railroad, and 75% favor Mr. Ackman’s proposal to replace Mr. Green with Hunter Harrison, the former head of Canadian National Railway.
Operating costs rose to 80.1% of Canadian Pacific’s sales in the first quarter from 79.4% in the same period in 2006, a month before Mr. Green took the top job. That operating ratio was the highest of the seven largest North American railroads.