Canadian Pacific Railway Limited (CP) has submitted a new proposal to acquire Kansas City Southern (KCS) in a stock and cash transaction.
The proposal represents an enterprise value of approximately US$31 billion, offering KCS stockholders an alternative recognizing the premium value of KCS while providing more regulatory certainty.
The proposed transaction, which has the unanimous support of the CP Board of Directors, values KCS at $300 per share.
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.
This superior proposal represents improved terms to those agreed to in the CP-KCS merger agreement entered into on March 21, 2021, that are substantially similar to those in the CN merger agreement, but offers significantly higher regulatory certainty than the proposed CN merger and significantly higher value than the previously agreed combination.
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. CP provides North American customers with a competitive rail service with access to key markets in every corner of the globe. CP offers a suite of freight transportation services, logistics solutions and supply chain expertise.
Canadian Pacific Railway Limited (CP) opened trading at C$90.41 per share.