OTTAWA (dpa-AFX) - Canadian Pacific Railway (CP.TO, CP) has urged the Surface Transportation Board to promptly confirmed that consideration of the uniquely straightforward and beneficial Canadian Pacific Railway/Kansas City Southern (KSU) transaction may proceed under the pre-2001 rules and that Canadian Pacific's voting trust proposal requires no further Board approval.
In March, Canadian Pacific Railway agreed to acquire Kansas City Southern in a stock and cash transaction representing an enterprise value of about $29 billion. The deal included the assumption of $3.8 billion of outstanding Kansas City Southern debt.
On Tuesday, Canadian National Railway Co (CNI, CNR.TO) or CN made a proposal to buy Kansas City Southern in a cash-and-stock transaction valued at $33.7 billion, including $3.8 billion of KCS debt.
Canadian Pacific Railway noted Wednesday that a CP/KCS transaction diminishes the pressure for downstream consolidation by preserving the basic six-railroad structure of the North American rail network: two in the West, two in the East, and two in Canada, each with access to the U.S. Gulf Coast. By contrast, a CN/KCS transaction would fundamentally disrupt this balance.
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