Tuesday, 24 April 2012 - 02:25
Canadian Pacific Disputes Latest Ackman Comments
DOW JONES NEWSWIRES
Canadian Pacific Railway Ltd. (CP, CP.T) fired back again at Pershing Square Capital head Bill Ackman after the activist U.S. investor suggested the company massaged its first-quarter results.
Ackman wants to replace almost half of the Calgary company's board with his own nominees in order to install Hunter Harrison, former chief of Canadian Pacific rival Canadian National Railway Co. (CNI), as the new chief executive. Canadian Pacific's board supports current chief Fred Green.
Ackman detailed his latest criticism Monday on Canadian news channel BNN, claiming CP didn't accrue for bonuses in its first-quarter results, reported Friday, to make its operating ratio look better than it otherwise would be. He also criticized a recent acquisition and other strategic decisions by the company's management.
The Canadian rail giant said Pershing Square's analysis of incentive compensation accruals was wrong, noting that accruals increased partly due to a higher share price.
"It is outrageous for Mr. Ackman to make the accusations he did today on the Business News Network," said Dick Kelly, chairman of the board's audit committee. "He attacks the competence of our audit committee, which approved our first-quarter results."
Canadian Pacific also defended its recent land sales, calling recent divestitures in line with historical norms.
Shares closed down 2.8% at $74.80 Monday after a broad market selloff. They were lightly traded after hours.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com
(END) Dow Jones Newswires
April 23, 2012 19:25 ET (23:25 GMT)
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