Melinda Gates now among largest CN shareholders after marital split stock transfer

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As Bill and Melinda Gates prepare to go their separate ways, the billionaire founder of Microsoft Corp. has transferred more than 14 million shares of Canadian National Railway Co. to his wife of 27 years, putting her among CN’s top 10 shareholders.

The two per cent stake in the company was worth more than $1.8 billion on Wednesday afternoon, based on CN’s share price of $134.95.

Bill Gates, who has been accumulating shares in CN since at least 2006 through his private investment vehicle Cascade, was already the largest single shareholder of the railway company, and he continues to hold a 12.3 per cent stake following the May 3 transfer of 14,086,339 common shares to Melinda in what regulatory filings described as “a private transaction, for no consideration.”

Gates and his soon-to-be ex-wife are the beneficial owners of an additional 13,907,283 shares of CN, about two per cent of the company, which is held by the Bill & Melinda Foundation Trust. They are listed as co-trustees of the foundation.

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Melinda’s individual holding in CN is larger than stakes held by major Canadian institutional investors including TD Asset Management Inc., the Caisse de dépôt et placement du Québec, and Jarislowsky Fraser Ltd. as of Dec. 31, according to Nasdaq. Larger stockholders in the top 10 at that time included Royal Bank of Canada, TCI Fund Management Ltd., Massachusetts Financial Services Co. and The Vanguard Group Inc.

The transfer of the railway company shares to Melinda Gates was part of a larger division of wealth by the divorcing couple this week. Regulatory filings show Bill Gates transferred nearly three million common shares of AutoNation Inc., a Fort Lauderdale, Florida-based auto sales and finance company, to Melinda from Cascade, again “for no consideration.” Those shares were worth almost US$307,000,000 Wednesday afternoon, with AutoNation trading at US$104.38 of a share.

News of their divorced after nearly three decades of marriage came as a surprise. It follows last year’s split of another billionaire tech couple, Amazon.com Inc. founder Jeff Bezos and wife MacKenzie Scott. The division of their finances after the split was announced vaulted Scott into the top 25 wealthiest people in the world, according to the latest annual list produced by Forbes magazine.

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Gates, the fourth-richest person on that list, with an estimated fortune of US$124 billion, is best-known as the founder of Microsoft. But he has made headlines more recently for his philanthropy, alongside Melinda, including their foundation’s work to improve COVID-19 vaccine technology and access in developing nations.

Observers have speculated over the years that his interest in CN is linked to his friendship with Warren Buffett, the investment guru two notches below him on the latest rich list. Buffett and his firm Berkshire Hathaway Inc. have been bullish on railways for years. Key investments in the sector have included Buffett’s profitable 2009 buyout of Burlington Northern Santa Fe LLC for US$26.5 billion.