Pershing Square Capital Management, which successfully campaigned for changes at Canadian Pacific Railway Ltd. (TSX: T.CP, Stock Forum), said Monday that it plans to sell up to seven million of the railway's shares over the next six to 12 months.
The investment manager, headed by chief executive Bill Ackman, said after the sale the firm will continue to be CP Rail's largest shareholder and the railway will be one of Pershing Square's largest investments.
CP shares closeddown $2.20 to $135.64 on Monday. The stock has been heading lower since hitting a 52-week high of $144.30 May 17.
The stock has soared since Pershing Square, won the battle to install new board members and a new chief executive, Hunter Harrison, who formerly held the top executive job at Canadian National Railway Co. (TSX: T.CNR, Stock Forum)
"Thanks to Hunter Harrison's and the CP team's performance over the last nearly one year, Canadian Pacific's share price has more than tripled since we first invested in CP," Ackman said in a statement.
"As a result, our stake in CP has grown to approximately 26 per cent of the combined assets of our funds. Given that increased concentration, portfolio management considerations have driven our decision to trim our holdings."
Harrison was hired to replace Fred Green as CP Rail's CEO last summer after Ackman led a bitter proxy fight.
The share sales will begin on or after June 10 and not exceed 10 per cent of the combined New York Stock Exchange and Toronto Stock Exchange volume.
Pershing Square's representatives, Ackman and Paul Hilal, will continue to serve on the company's board of directors. (With files from The Canadian Press).