By Paul Vieira

OTTAWA -- TFI International Chief Executive Officer Alain Bédard said he had scrapped, for now, plans to move the logistics company's headquarters from Montreal to the U.S. because of concerns from the company's big American shareholders.

In an interview, Bédard said some shareholders in the U.S. fretted that they would have to sell some of their holdings in TFI because they wouldn't qualify for international-focused funds. He didn't identify which asset managers.

Bédard said political tensions between Canada and the U.S., with President Trump threatening hefty tariffs on Canadian imports and making repeated calls for Canada to become the 51st state, played no role in reversing the decision.

"We don't play political games," Bédard said Wednesday. "I mean, we're truckers. We're simple people."

A week ago, as part of its fourth-quarter earnings release, TFI said it intended to pursue domiciliation in the U.S., arguing the bulk of its revenue is from the U.S. and a plurality of its shareholders are American. During an earnings call with analysts, he said moving to the U.S. would mark an evolution for the company, and "better align with our shareholder base and commercial presence."

Five days later, TFI said it would remain a Canadian corporation, adding it changed course after feedback from shareholders. Among the shareholders was the pension fund Caisse de Dépôt et Placement du Quebec, which said it wasn't informed about the trucking company's intentions. "Preserving Quebec's interests is always at the forefront of our priorities as a shareholder," a Caisse spokeswoman said.

Bédard said what TFI initially announced was the intention to look at moving the headquarters, and that would require board and shareholder approval. In addition to being CEO, Bédard is also board chairman, and owns about 5.5% of the company's shares outstanding, according to FactSet data.

"We were surprised to see the reaction in the sense that we just said, 'OK, we're looking into that,'" Bédard said. "That doesn't mean it's a done deal. We never said we were doing it."

Bédard said some U.S. asset managers told him and Chief Financial Officer David Saperstein that they held the company's shares in international funds, or U.S. investment vehicles intended to hold solely foreign-owned companies.

"We were learning things that we were not aware of," Bédard said. Given the negative reaction to both the domicile news and its fourth-quarter earnings, which missed analyst expectations, Bédard said he decided "to eliminate" the headquarters move.

"We have some things to fix in our own company. It's a very difficult market for the last two and a half years, and we had a difficult fourth quarter," he said. "We have got so many other issues to fix. We're just going to go back to being Canadian for now."

Since the release of the fourth-quarter earnings and domicile plans, shares of TFI lost 27% of their value, trading Wednesday at about 133 Canadian dollars ($92).

TFI's biggest shareholder is Capital Research and Management, an asset manager that's a subsidiary of Delaware-based Capital Group, with a nearly 14% stake. A spokeswoman for Capital Group declined to comment on its TFI holdings.

Bédard said he is willing to revisit the domicile issue in about a year's time, noting further growth in Canada is limited and the U.S. represents the company's best opportunity. "We were probably too fast in the North American environment," he said.

Write to Paul Vieira at Paul.Vieira@wsj.com

(END) Dow Jones Newswires

February 26, 2025 15:33 ET (20:33 GMT)

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