Activist investor group calls for Norfolk Southern CEO's ouster, board changes (update)

Update 4:05pm: Adds Norfolks Southern response.

An investor group led by Ancora Holdings is calling for the ouster of Norfolk Southern (NYSE:NSC) CEO Alan Shaw and has nominated eight candidates for the railroad operator's board, including former Ohio governor John Kasich. Norfolk Southern ticked up almost 1%.

Ancora, which reportedly has a ~$1B stake in Norfolk Southern (NSC), also proposed a new management team led by Jim Barber Jr. as CEO and turnaround expert Jamie Boychuck as chief operating officer, according to a statement on Tuesday.

The Ancora push comes after the WSJ reported late last month that the activist had acquired a ~$1B stake in the railroad and planned to nominate a majority slate of directors to the company's board in an attempt to oust Shaw. Hedge funds Sachem Head Capital Management and D.E. Shaw also recently began building their own stakes in Norfolk Southern (NSC).

“Norfolk Southern, which has exceptional rail workers and the country’s best customers, has suffered for years due to its Board’s poor decisions with regard to the Company’s leadership, safety priorities and strategy," the investor group said in a presentation on Tuesday.

Norfolk Southern (NSC) responded to the Ancora nominees in a statement on Tuesday.

"Since receiving Ancora's nominations, members of both the board and management team have held multiple discussions with representatives of Ancora to better understand their views and communicate Norfolk Southern's perspectives on the execution of our strategy," the railroad operator said in the statement.

"The board regularly evaluates its composition and will continue its careful review of Ancora's nominees with a focus on advancing our goal of building the safe, reliable, and resilient railroad our customers and shareholders expect," Norfolk Southern (NSC) added in the statement.

Barber is a shipping and logistics industry veteran who previously spent more than 35 years at United Parcel Service (UPS), most recently serving as the COO and President from 2018 to 2020. Boychuck previously served as EVP of Operations at CSX Corp. (CSX). Before CSX, he spent more than two decades at Canadian National Railway (CNI).

Other board nominees include Betsy Atkins, William Clyburn, Nelda Connors, Sameh Fahmy, Gilbert Lamphere and Allison Landry.

Norfolk Southern (NSC) is scheduled to present at the Citi 2024 Global Industrial Tech and Mobility Conference on Wednesday.