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  • Kansas City Southern announced that its Board of Directors has determined that CP’s revised proposal constitutes a “Company Superior Proposal”
  • KCS has notified CN that it intends to terminate KCS’s merger agreement with CN and enter into the definitive agreement with CP
  • Under CP’s proposal, each share of KCS common stock would be exchanged for 2.884 CP common shares and $90 in cash
  • The proposal is binding on CP and may be accepted by KCS at any time prior to 5:00 pm EDT on Monday, September 20
  • Canadian Pacific (CP), a transcontinental railway in Canada and the United States, offers a suite of freight transportation services and logistics solutions
  • Canadian Pacific Railway Limited (CP) opened trading at C$86.91 per share

Canadian Pacific Railway Limited (CP) announced that it has completed negotiations of a proposed merger agreement with Kansas City Southern.

The KCS Board of Directors deemed a “Company Superior Proposal” after consulting with the company’s outside legal and financial advisors.

“We are pleased to reach this important milestone and again pursue this once-in-a-lifetime partnership,” said Keith Creel, CP President and CEO.

“As we have said throughout this process, CP remains committed to everything this opportunity presents. This merger proposal provides KCS stockholders greater regulatory and value certainty. We are excited to move forward as we work toward making this perfect match a reality.”

The merger proposal values KCS at $300 per share, representing a 34 per cent premium, based on the CP closing price on August 9, 2021, and KCS’s unaffected closing price on March 19, 2021.

Following the closing into a voting trust, common shareholders of KCS will receive 2.884 CP common shares and $90 in cash for each share of KCS common stock held. The proposed transaction includes the assumption of $3.8 billion of outstanding KCS debt.

The proposal is binding on CP and may be accepted by KCS at any time prior to 5:00 pm EDT on Monday, September 20, 2021. The transaction would be subject to approval by the stockholders of CP and KCS, receipt of regulatory approvals and other customary closing conditions.

KCS has notified CN that it intends to terminate KCS’s merger agreement with CN and enter into the definitive agreement with CP, subject to CN’s right to negotiate amendments to the merger agreement for at least five business days and the KCS Board’s further determination as to whether any such amendments would cause the CP proposal no longer to constitute a “Company Superior Proposal.”

Headquartered in Kansas City, Mo., Kansas City Southern is a transportation holding company that has railroad investments in the U.S., Mexico and Panama.

Canadian Pacific (CP) is a transcontinental railway in Canada and the United States with direct links to major ports on the west and east coasts.

Canadian Pacific Railway Limited (CP) opened trading at C$86.91 per share.

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