- Kansas City Southern (KSU) has scheduled a virtual meeting of stockholders on August 19, 2021, at 9:00 a.m. CST
- The KCS Board of Directors unanimously recommends that stockholders vote in favour of the merger agreement with CN
- CN will acquire KCS shares and place them into a voting trust if such trust is approved by the STB
- CN is a world-class transportation leader and trade enabler
- Kansas City Southern (KSU) is a transportation holding company that has railroad investments in the U.S., Mexico and Panama
- Canadian National Railway (CNR) opened trading at C$132.31 per share
Kansas City Southern (KSU) has scheduled a virtual meeting of stockholders on August 19, 2021, at 9:00 a.m. Central Time.
All stockholders of record of KCS common stock and KCS 4% non-cumulative preferred stock as of the close of business on July 1, 2021, will be entitled to vote their shares at the meeting.
Under the terms of the agreement, which was unanimously approved by the board of directors of each company, KCS stockholders will receive $200 in cash and 1.129 shares of CN common stock for each KCS common share, with KCS stockholders expected to own approximately 12.65% of the combined company.
KCS’ preferred stockholders will receive $37.50 in cash for each preferred share.
JJ Ruest, President and CEO of CN commented on the combination with KCS.
“We are thrilled to be taking this important next step and giving KCS stockholders the opportunity to vote on the creation of the premier railway for the 21st century. Numerous stakeholders of both companies have voiced overwhelming support for this compelling combination, and we look forward to delivering the many benefits of this pro-competitive transaction to them. This combination delivers significant value to KCS stockholders along with the opportunity to participate in the significant upside of the combined company.”
Patrick J. Ottensmeyer, President and CEO of KCS added,
“The filing of the definitive proxy statement represents an important milestone as we work toward completing this transaction. By joining with CN, KCS will provide our customers access to new single-line transportation services at the best value for their transportation dollar, while increasing competition among the Class 1 railroads. Together, CN and KCS will be positioned to deliver on the transaction’s powerful potential to create new growth opportunities for our customers, employees, labor partners, communities and stockholders.”
The KCS Board of Directors unanimously recommends that stockholders vote “FOR” the merger agreement with CN and the other proposals outlined in the definitive proxy statement.
CN will acquire KCS shares and place them into a voting trust if such trust is approved by the Surface Transportation Board (STB). KCS stockholders will receive the merger consideration immediately upon the closing into CN’s voting trust, which is expected to be in the second half of 2021. Following this step, the STB and other regulatory authorities will complete their review of CN’s control of KCS.
Upon approval, the completion of the transaction to take the KCS shares out of the voting trust is expected to take place in the second half of 2022.
CN’s voting trust is an integral component of the CN-KCS combination. It prevents premature control of KCS, allows KCS to maintain independence and protects KCS’ financial health during the STB’s review of the ultimate combination of CN and KCS. CN and KCS are confident that the voting trust meets all the standards set forth by the STB and believe that, after a fair and thorough review by the STB, it should be approved.
CN is a world-class transportation leader and trade enabler. Essential to the economy, to the customers, and to the communities it serves, CN safely transports more than 300 million tons of natural resources, manufactured products, and finished goods throughout North America every year. Kansas City Southern (KCS) (NYSE: KSU) is a transportation holding company that has railroad investments in the U.S., Mexico and Panama. Its primary U.S. holding is The Kansas City Southern Railway Company, serving the central and south-central U.S.
Canadian National Railway (CNR) opened trading at C$132.31 per share.
