May 9th, 2024, was no doubt marked on calendars of many Norfolk Southern (NYSE:NSC) stakeholders, as they awaited a vote set to resolve a proxy dispute between the company's current management, and activist investors, represented by Ancora Holdings.
The stakes were quite high for both sides: Ancora argued the company's current management was ineffective, and sought to put in place a new CEO and COO - a feat, achievable by getting the majority of seats on the company's board of 13 members.
NSC, for its part, defended the strategy of Alan Shaw, co's CEO since 2022, slammed the fund's cost-cutting proposals as mathematically unrealistic, and noted experience gaps of management-would be's.
To the relief of some, and the frustration of others, the day has now come, and the vote results are in:
- Shareholders voted for 10 out of 13 of NSC's nominees, including CEO Alan Shaw.
- Shareholders for 3 out of 7 Ancora nominees, notably excluding the fund's proposed CEO Jim Barber.
Once new appointments are finalized, the board will consist of 10 NSC-appointed members, and 3 directors pushed through by Ancora.
At least for now, NSC appears to have prevailed in persuading the voters.
In its post-vote comment, Ancora called the result "an extremely positive development for shareholders," although the fund clearly felt short of its goal of establishing the majority and securing radical changes at the helm.
"Our shareholders recognize that positive change is underway at Norfolk Southern," - said Norfolk Southern in its own post-vote statement, adding "we will continue building on the significant progress Alan Shaw, John Orr, and the entire team have already achieved."
NSC shares opened around 5% lower on Thursday morning following the proxy vote, and are trading at just over $220.