CN Rail has named Claude Mongeau to succeed Hunter Harrison as president and chief executive officer, the Financial Post reported.
Mr. Mongeau, currently chief financial officer, takes over from Mr. Harrison effective Jan. 1, 2010.
David McLean, chairman of CN Rail's board, said: "The board thoroughly reviewed the company's future strategic priorities and the skills and attributes required of our new CEO. We are confident that Claude is the best candidate to build on the successes achieved to date."
"Claude is an exceptional executive and leader. He is one of the architects of CN's industry-leading financial performance and the key strategist behind the highly successful rail acquisitions that have grown CN's reach throughout North America and made it a key industry player. He has a keen appreciation of the power of CN's unique business model -- Precision Railroading -- and will be supported by an outstanding team of railroaders."
(The preceding article appeared on the Web site of the Financial Post at www.financialpost.com on April 21, 2009.)
(The following story by Brent Jang and Nathan Vanderklippe appeared on the Globe and Mail website on April 22, 2009.)
TORONTO and CALGARY Claude Mongeau isn't afraid to get his hands dirty to find out how the trains are running at Canadian National Railway Co. CNR-T
After nearly a decade as chief financial officer, Mr. Mongeau will take the railway's top job in January. But first, he'll be dealing with the grime that goes with traipsing through the ground operations of Canada's largest railway in the summer heat.
Mr. Mongeau, named yesterday to succeed retiring chief executive officer Hunter Harrison next Jan. 1, will spend three or four months on the tracks, wearing a reflective vest, safety attire and a tag that reads "Railroader in Training" as he takes an in-depth look at the tracks, terminals and repair facilities.
"It gives you some idea of what kind of a guy he is," CN chairman David McLean said yesterday after Mr. Mongeau was named CEO just before the railway's annual meeting in Calgary.
Mr. Mongeau rose through the ranks during the years that CN moved from "the worst railroad to the very best," as he put it to shareholders, from its 1995 privatization through major acquisitions in which he was a key player.
His challenge now will be to guide the railway after the bruising of the recession, trying to drum up new freight business while keeping costs under control. As the economy rebounds, CN will be positioned to thrive with an expected increase in freight traffic, he said yesterday.
Mr. Mongeau, 47, is already qualified as a conductor, and he will be tackling the task of an engineer this summer, learning how to operate the powerful locomotives pulling trains that can stretch more than 1.6 kilometres.
He has a hard act to follow. He takes over from Mr. Harrison, who is widely praised for building CN into a "precision" railway and a leader in the industry.
Mr. Mongeau will bring to the CEO role his skills as a strategic thinker who gets things done, a sharp financial mind, and a wealth of experience in making acquisitions.
"I've never seen a guy who could go out and implement and execute on an acquisition so well," said former CN director Purdy Crawford. "Just incredible. How he ties down the points. It's hard to find anybody who can negotiate as well as him in terms of putting together a deal."
Mr. Mongeau joined CN as assistant vice-president of corporate development in 1994, recruited by Michael Sabia, then a CN executive and now chief of the Caisse de dépôt et placement du Québec.
Jim Gray, who retired from CN's board yesterday after nearly 13 years as a director, said it seems a natural progression for the railway to move from Paul Tellier as CEO in 1992 to Mr. Harrison in 2003 to Mr. Mongeau in 2010.
"This guy is not just a numbers guy. He goes far beyond that," Mr. Gray said after CN's annual meeting at a Calgary hotel, just blocks away from the head office of rival Canadian Pacific Railway Ltd., whose trains could be heard rumbling in the background.
In his speech to shareholders, Mr. Mongeau pledged to look for growth, acknowledging that "I will have big shoes to fill." He praised CN's transformation "from an inward-looking organization to a strategically-looking organization." After the meeting, he deflected attention to Mr. Harrison. "Today is the day for our CEO," Mr. Mongeau said.
Mr. Harrison, 64, said in an interview that his successor has been groomed to lead a management team with bench strength.
"Claude is a bright young man with a financial mind, and he's grown beyond that. He's a strategic thinker," said Mr. Harrison, a veteran railroader from Tennessee. "He's become a qualified conductor and he's becoming a qualified engineer. So, he's learning the business in a unique way, from the top-down, as well as the bottom-up."
CANADIAN NATIONAL (CNR) Close: $50.18, up $1.40
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CLAUDE MONGEAU:
A SNAPSHOT OF THE NEW CEO
BORN: St-Hyacinthe, Que., about 50 kilometres east of
Montreal AGE: 47 FAMILY: Married, with one son and two daughters EDUCATION: Psychology degree, Université du Québec à Montréal, 1985
MBA from Institut Supérieur des Affaires in Paris and McGill University in Montreal, 1988 CAREER: Worked at consulting firms Bain & Co. in Paris and Groupe Secor in Montreal, and conglomerate Imasco Ltd.
Joined CN in 1994 and became the railway's chief financial officer in 1999.
THE CHALLENGE: To keep costs under control amid economic uncertainty and maintain CN's momentum after Hunter Harrison retires as CEO.
