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Under the deal, Norfolk Southern will add another independent
director to its board and work to further improve its
operations.
Ancora, meanwhile, agreed to drop its nominations of four new
board directors to be elected at next year's annual meeting. The
Ohio-based investor won three seats on the board earlier this
year, but didn't win enough seats to make the sweeping changes,
including replacing management, that it sought.
But management changes came anyway in September, when former CEO
Alan Shaw was fired for having an inappropriate relationship
with the railroad's chief legal officer. CFO Mark George was
promoted to lead the railroad alongside the new operating chief
who was hired in the spring in the middle of the fight with
Ancora.
George has said he doesn't plan to abandon the strategy Shaw
outlined, which aims to maintain more resources on hand during
economic downturns so the railroad can provide better service
and be prepared to respond to increased shipments when the
economy eventually recovers. But George also signaled that he
won't tolerate mediocrity and will keep the pressure on to make
the railroad more profitable and efficient.
“We are making meaningful progress on key operational metrics,
as evidenced by our strong third quarter 2024 results in which
we drove productivity, grew volumes, and delivered notable
margin improvement," George said.
Ancora's Chairman and CEO Frederick DiSanto and James Chadwick,
who leads Ancora Alternatives, indicated they like what they
have been seeing.
“In our view, it’s a new day at Norfolk Southern following board
refreshment, management enhancements, and new leadership’s
efforts to establish a disciplined and operationally led
network," DiSanto and Chadwick said in a statement.
Atlanta-based Norfolk Southern Corp. is one of the nation's
biggest railroads with tracks crisscrossing the eastern United
States.
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