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Canadian Pacific Railway to buy Kansas City Southern for US$25 billion
[TORONTOSUN] Canadian Pacific Railway Ltd on Sunday said it has agreed to buy Kansas City Southern for US$25 billion in a cash-and-shares deal to create the first rail network connecting the United States, Mexico, and Canada, betting on a pick-up in North American trade.The deal would create the first U.S.-Mexico-Canada railroad, offering a single integrated rail system connecting ports on the U.S. Gulf, Atlantic and Pacific coasts with overseas markets. Shareholders of Kansas City Southern will receive 0.489 of a Canadian Pacific share and $90 in cash for each KCS common share held, valuing Kansas City Southern at $275 per share, a 23% premium to Friday’s closing price, the companies said in a joint statement. Including debt, the deal is valued at $29 billion. The deal is contingent on the U.S. Surface Transportation Board (STB) blessing the transaction and Canadian railroad operators’ previous attempts to buy U.S. rail companies have met limited success. Posted by: Fred 2021-03-23 |
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