Thursday, October 18, 2007

CSX Employee Union Backs TCI

The CSX (CSX) saga gets more interesting by the hour it seems.

"The hired hands who manage CSX railroad should be given their walking papers," said Paul Thompson, The United Transportation Union President, which represents 11,000 CSX employees.

The NY Times today speculated that Atticus Capital, a shareholder in CSX may team up with TCI like the two did in their successful campaign against the proposed merger between London Stock Exchange and Deutsche Borse. Atticus, with $13 billion under management, has accumulated 10.2 million CSX shares, a 2.3 percent stake, as of 12/31/2006.

Also in the mix is Carl Icahn who in March of 2007 purchased 2.9 million shares of the railroad. Given Mr. Icahn's recent track record, should be choose to publicly back TCI and Atticus, it would be almost impossible for management not to take whatever is said very seriously.

Consider the trio would have over 7% of the outstanding common shares, a wildly successful history and the backing of 11,0000 CSX employees. It will only be a matter of time before additional shareholders begin taking a close look and backing TCI.

Chairman and CEO Michael Ward collected $13.8 million last year making him the highest paid railroad executive. TCI has made a convincing case that his company's performance is more a factor of macroeconomics events pulling it along rather management's skill driving those results.

Stay tuned...

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