CALGARY - Canadian Pacific Railway Ltd. CEO Hunter Harrison received a total of $49.2 million in compensation last year, most of it to make up for pension and other payments that his previous employer refused to pay when he took the top job at the rival railway.
Harrison's direct compensation, including a $1 million base salary, totalled $4.1 million in 2012, according to an information circular posted ahead of the company's May annual general meeting.
There was another $44.5 million to make Harrison "whole" for pension, restricted stock unit and other payments that Canadian National Railway Co. (TSX:CN) refused to pay.
Harrison retired as CN's CEO in 2009.
When Harrison made public his intention to lead rival CP (TSX:CP), CN took legal action, accusing him of breaching non-compete and other agreements he signed upon retirement. The suit was settled last month.
The remainder of Harrison's compensation came from other hiring costs.
Harrison was installed as CEO of CP last summer following a bruising proxy fight with activist hedge fund Pershing Square Capital Management.
Pershing Square CEO Bill Ackman fought to replace then-CEO Fred Green with Harrison, who he believed was the right man to stage a turnaround at the underperforming railway.
Green was given about $4 million in severance, according to the circular.
Under Harrison's leadership, CP has been cutting its workforce and is moving its headquarters out of downtown Calgary to near its suburban railyard.
"Based on the mandate from CP shareholders, the board sought and secured the best possible CEO in the industry. Mr. Harrison is a veteran railroader who is one of the most respected and successful leaders in the industry and has brought with him to CP an enviable track record," CP spokesman Ed Greenberg said in an emailed statement.
"Mr. Harrison has been a significant catalyst for change and, in less than a year, he has taken this railway to new levels of operational excellence."