U.K. Hedge Fund Seeks Rail Returns
A British hedge fund that owns shares of U.S. railroads Union Pacific Corp. and BNSF Railway, in addition to its previously disclosed holdings of CSX Corp., wants better returns from its U.S. rail holdings, Bloomberg reported.
Railroad holdings are among the largest positions in the fund of TCI Fund Management LLP, Bloomberg said, citing Snehal Amin, founding partner of the fund.
Amin told a transportation conference sponsored by Bear Stearns in New York this week that railroads must boost their return to shareholders by upgrading their management and taking on more debt, Bloomberg said.
The fund wants CSX to raise its rates and improve safety management, Bloomberg reported.
But Bear Stearns transportation analyst Ed Wolfe questioned whether the fund would meet some of its railroad-related goals.
“We don’t believe the competitive, labor or regulatory environments are conducive for a much greater rate of change,” Wolfe wrote in a note to investors, reporting on the conference and discussions.
