March 3 CSX Corp is nearing a deal with
one of its largest investors, activist hedge fund Mantle Ridge
LP, to sign up veteran railroad executive Hunter Harrison as the
U.S. railroad company's CEO, people familiar with the matter
said on Friday.
Talks between CSX's board and Mantle Ridge have been
advancing, the people said, getting closer to a deal that could
be announced as early as next week. Final details, however, are
still being worked out, and the talks may end unsuccessfully,
the people added.
The sources asked not to be identified because the
negotiations are confidential. CSX, Mantle Ridge and Harrison
all declined to comment.
CSX and Mantle Ridge have been locked in a battle over
Harrison's contract as well as the investor's intent on shaking
up the company's board.
Mantle Ridge owns 4.9 percent of the company, according to a
letter the firm published last month.
CSX announced last month that CEO Michael Ward was stepping
down, effective on May 31. CSX's stock has surged more than 30
percent since January, when news first appeared that Harrison
was planning to leave his CEO slot at Canadian Pacific to seek
the top job at CSX.
Harrison would become CEO under a four-year contract,
Bloomberg News reported earlier on Friday - which would mark a
victory for Mantle Ridge, whose founder Paul Hilal had argued
that the company's preference of a two-year deal was not long
Reuters first reported in late January that a portfolio
manager at Neuberger Berman LLC, which owned 1.2 percent of CSX
shares as of Sept. 30 and is the company's tenth-largest
shareholder, had thrown her support behind a plan to put
Harrison into CSX's CEO chair with the help of Mantle Ridge.
CSX has called for a special meeting for shareholders to
vote on Harrison's proposed compensation package and for the
board seats that Mantle Ridge is seeking. Bloomberg said on
Friday that the company still planned to hold the vote even if
Harrison is installed next week.
(Reporting by Michael Flaherty in New York, editing by G