Shares of Union Pacific Corp. on Monday were on pace for the biggest percentage gain in nearly three years a day after the railroading giant said it expects to install a new chief executive this year following pressure from a hedge fund. Union Pacific
jumped 10% to $212.05 on Monday, which would be the stock’s largest percentage increase since March 24, 2020, when shares rose 13%.
Union Pacific on Sunday said it expected to name a successor to Lance Fritz — a move praised by some analysts on Monday. Fritz has been the company’s CEO since 2015. His successor would take the helm this year. Union Pacific said that it sought the aid of a consultant and formed a task force of directors last year in an effort to find a new chief executive, following discussions between Fritz and the board. As part of that planning process, Union Pacific also said it had been “actively engaging” with Soroban Capital Partners — the hedge fund that expressed its complaints about Fritz in a letter to the company — since 2017. Soroban said it owns a roughly $1.6 billion stake in Union Pacific. See also: Ohio derailment a ‘PR nightmare’ for Norfolk Southern and the rail industry In that letter, on Sunday, Eric Mandelblatt, the fund’s managing partner and chief investment officer, said it was crucial for Union Pacific’s board to act now, and capitalize on what he said was set to be a “golden age of railroading growth,” as new investments roll in and the trucking industry struggles amid waning demand for goods and a loosening supply chain pull shipping prices lower. “UNP has repeatedly and significantly failed to reach its potential under Mr. Fritz’ …