Manchin Calls for Hearing On Attempted Wall Street Takeover of Norfolk Southern
Merger will profit Wall Street investors while potentially costing hundreds of West Virginia jobs
Washington, D.C. – At a press conference in Charleston, U.S. Senator Joe Manchin (D-WV) today announced that he is calling for an immediate Senate investigation into Canadian Pacific Railway’s plan to acquire Norfolk Southern, a transaction that will profit Wall Street investors, while potentially costing hundreds of jobs in West Virginia. Senator Manchin is insisting that the details of this merger be thoroughly reviewed by the Senate Committee on Commerce, Science and Transportation before any element of this transaction is allowed to proceed.
Canadian Pacific Railway’s attempt to acquire Norfolk Southern is troubling because of Canadian Pacific Railway’s history of cutting jobs to increase investor profits. In 2011, Bill Ackman, hedge fund manager at Pershing Square Capital Management and one of the largest shareholders of Canadian Pacific Railway, acquired 14.2 percent of the company’s outstanding shares and initiated an ugly proxy battle that he ultimately won. This earned Ackman more board members, a new Chief Executive Officer, Mr. Hunter Harrison, and a new direction for the Canadian railroad that had a history and a culture of promoting from within. It cost Ackman $40 million to repay Harrison's retirement plan that Canadian National pulled after he violated his non-compete clause to go work for Canadian Pacific, their largest competitor, almost four years ago.
Since Harrison took over as CEO of Canadian Pacific Railway, the company has slashed 6,000 jobs, including 1,800 people in 2015. Just last week, Harrison announced plans to cut another 1,000 jobs – or 12 percent of its workforce – in 2016.
“This is not just an ordinary merger. This is an attempt by a Wall Street titan to purchase and dismantle an American rail company that has provided jobs for hundreds of West Virginians,” Senator Manchin said. “We can't get any specifics from Hunter Harrison or Bill Ackman about where the $1.8 billion will come from in this deal with Norfolk Southern, but we know the harm they have done at Canadian Pacific. This merger creates real and present dangers to hardworking people of West Virginia. I’m calling for a Commerce Committee investigation into this merger because I want to ask Hunter Harrison what they are going to invest in, what they are going to build, and how they are going to help the people and the communities of our state. West Virginia cannot afford a corporate partner more focused on short-term gains for stockholders than the hard-working men and women who show up to work every day. In this economy, I'm going to fight to protect every single West Virginian job I can."
For years, Norfolk Southern has been committed not just to its shareholders, but to its employees and to the West Virginia communities it serves. Norfolk Southern currently employs 990 people and supports 430 retirees in the Mountain State. For more information, please click here.
For a comprehensive map of railways throughout the Northeastern United States, click here.
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