Norfolk Southern (NYSE:NSC) shares rallied Thursday on the back of a Wall Street Journal report that said an Ancora Holdings-led investor group has taken an approximately $1 billion stake in the company.
In addition, the WSJ said the investor group has nominated a majority slate of directors to the railroad operator's board in a bid to unseat CEO Alan Shaw.
NSC shares are up more than 6% as of 10:12 am ET on Thursday.
The director slate comprises former Ohio Governor John Kasich and Sameh Fahmy, a former executive at railroad operator Kansas City Southern, according to the report on Wednesday citing people familiar with the matter.
Norfolk Southern has reportedly met with the group and the director nominees. They reportedly raised concerns regarding the company's handling of a train derailment last year and Shaw's failure to meet operational targets.
Last week, NSC reported earnings, with fourth-quarter profits below the analyst consensus estimate.
The Wall Street Journal added that both Sachem Head Capital Management and D.E. Shaw have recently been building their stakes in Norfolk Southern.