CALGARY — Canadian Nationwide Railway Co. says it has filed a letter with the U.S. regulator that governs railway mergers declaring its bid for the Kansas Metropolis Southern railroad to be pro-competitive and within the public curiosity.
CN’s letter says it additionally goals to “appropriate deceptive statements” in a letter rival Canadian Pacific Railway Ltd. reported sending to the U.S. Floor Transportation Board on Thursday, by which it once more referred to as CN’s provide ““illusory” and “anticompetitive.”
On Tuesday, Montreal-based CN introduced a cash-and-stock bid valued at US$33.7 billion for Kansas Metropolis, Mo.-based KCS, topping one made final month by Calgary-based CP Rail valued at US$25 billion.
The 2 Canadian railways have been buying and selling barbs since then, with CP insisting a CN-KCS merger can’t be permitted as a result of CN is far bigger than CP and its community has extra overlap with KCS, and CN arguing that its provide is “superior” for each buyers and shippers and subsequently within the public curiosity.
CP says that greater than 400 shippers have filed letters supporting its bid. In its letter Friday, CN says it has spoken to quite a few clients and different stakeholders since saying its provide and lots of wish to write letters of assist which CN will share with the STB “in coming days.”
The 2 don’t even agree on how large a CN-KCS mixture could be — CN says it could be the fifth largest Class 1 railway (counting solely U.S. operations ruled by the STB), whereas CP says it could be third-largest in case you depend income from all belongings in Canada, Mexico and the USA.
KCS’s rail belongings in Mexico have lengthy made it a fascinating takeover goal.
“CN is assured that KCS will acknowledge the worth of the CN proposal and can select to companion with CN,” says the CN letter despatched Friday.
“However that could be a selection for KCS and its shareholders to make. Underneath the phrases of the KCS-CP merger settlement, CP has the chance to make a aggressive counteroffer if it needs and to make its pitch to KCS for why such a counteroffer could be superior.”
This report by The Canadian Press was first revealed April 23, 2021.
Firms on this story: (TSX:CNR, TSX:CP)
The Canadian Press