Conrail Needs New Chief at Critical Time

More than a dozen years after rising from the ashes of six bankrupt Northeast railroads, Conrail must replace its top executive at a time when it had just made a transition aimed at continuity.

Richard D. Sanborn, 52, died Sunday of an apparent heart attack, just six weeks after becoming chairman and chief executive of the Philadelphia-based freight carrier.

Speculation by some analysts focused Monday on H. William Brown, senior vice president for finance, and Charles N. Marshall, senior vice president for marketing and sales, as two candidates to take Sanborn’s place.

Others suggested L. Stanley Crane, 73, who retired as chairman and chief executive on Jan. 1, could return for an interim period while a search was made for someone from outside the company.

Conrail said it would make no announcement before a board meeting Wednesday.

Sanborn, a 27-year railroad veteran, joined Conrail last March as president and chief operating officer.

Tony Hatch, an analyst with Paine Webber Inc., said he considered it likely that Crane would be asked to return on a temporary basis.

Crane, who led the company for eight years, is credited with setting the direction that made Conrail profitable and enabled it to be returned to the private sector through a public stock offering in March, 1987.

Despite Sanborn’s death, analysts said the railroad’s future appears bright.

“There is no single person who is indispensable to a company,” said an analyst who asked not to be identified. “This is not a major disaster for Conrail, though it’s certainly tough in the short run.”

Conrail was formed by Congress in 1976 to reorganize six bankrupt Northeast railroads, the Penn Central, Erie Lackawanna, Reading, Central of New Jersey, Lehigh Valley and Lehigh & Hudson River. After 11 years of government ownership, Conrail was sold March 26, 1987, for $1.6 billion in the largest public stock offering in U.S. history.