A Canadian Pacific Railway employee walks along the side of a locomotive in a marshalling yard in Calgary on May 16, 2012. THE CANADIAN PRESS/Jeff McIntosh

A Canadian Pacific Railway employee walks along the side of a locomotive in a marshalling yard in Calgary on May 16, 2012. THE CANADIAN PRESS/Jeff McIntosh

CP Rail signs deal to buy Kansas City Southern for US$25 billion

CEO said deal will help integrate continent’s supply chains, which has become more pressing since USMCA

Canadian Pacific Railway Limited has agreed to buy Kansas City Southern in a bid to create a rail route linking Canada, the United States and Mexico.

The two companies announced in a joint press release that CP Rail has entered into a merger agreement to acquire Kansas City Southern for approximately US$25 billion.

Under the deal, shares of Kansas City Southern will be valued at US$275 per share, representing a 23 per cent premium over Friday closing prices.

KCS shareholders will receive 0.489 of a CP share and US$90 in cash for each KCS common share held.

The merger, which has to be approved by the Surface Transportation Board, will create what the companies describe as the first rail network connecting the three North American countries.

“This transaction will be transformative for North America, providing significant positive impacts for our respective employees, customers, communities, and shareholders,” CP President and Chief Executive Officer Keith Creel said in a statement.

“This will create the first U.S.-Mexico-Canada railroad, bringing together two railroads that have been keenly focused on providing quality service to their customers to unlock the full potential of their networks. CP and KCS have been the two best performing Class 1 railroads for the past three years on a revenue growth basis.”

Creel said the deal will help integrate the continent’s supply chains — a priority that has become more pressing since the signing of the USMCA free trade agreement.

The press release said the combined company will operate more than 32,100 kilometres of rail and generate total revenues of approximately US$8.7 billion based on 2020 figures.

“In combining with CP, customers will have access to new, single-line transportation services that will provide them with the best value for their transportation dollar and a strong competitive alternative to the larger Class 1s,” said KSC President and CEO Patrick J. Ottensmeyer.

The two companies will join together in Kansas City, Mo., and will run throughout Canada and at points in the U.S. Midwest, the U.S. Northeast and points on KCS’ system throughout Mexico and the South Central U.S.

The companies said the Surface Transportation Board review is expected to be completed by the middle of 2022.

The Canadian Press


Like us on Facebook and follow us on Twitter.

Want to support local journalism during the pandemic? Make a donation here.

CP Railrailway

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Rio Tinto BC Works General Manager Affonso Bizon receives his shot from Jordan Pacheco, a Rio Tinto paramedic. (Rio Tinto supplied photo)
60% of Rio Tinto’s eligible workforce have been administered COVID-19 vaccine

Immunization clinics within industrial sites are administering vaccines to workers 40 years or older

Gates will open at 8:30 p.m. with the first film starting around 9:15 p.m. - 9:30 p.m. (AFFNO file photo)
AFFNO hosts french film all weekend in the Kitimat-Stikine and Northcoast Region

AFFNO had to create different approaches this year to set up events

Radley Park and Hirsch Creek Park campgrounds will open on May long weekend but only for those who reside in the Northern or Interior Health regions. (Jacob Lubberts photo)
VIDEO: Kitimat camping still a go for May long weekend

Kitimat Campgrounds will still follow restriction put in place by PHO

UPDATE: Missing person found. (photo supplied)
UPDATE: missing person found – Kitimat local reported missing since May 2nd

If you have any information contact the local RCMP at (250) 632-7111

Rio Tinto donated $60,000 to BC Children’s Hospital as they look into the impact the pandemic has had on the mental health of young Canadians. (BC Children’s Hospital logo)
Rio Tinto supports BC Children’s Hospital mental health study

“This study will help us find out how we can better allocate mental health resources for youth”

(The Canadian Press)
Trudeau won’t say whether Canada supports patent waiver for COVID-19 vaccines

‘Canada is at the table to help find a solution’

A sign indicating face coverings are required by the establishment is pictured on the front door of a business in Vancouver, B.C., Friday, April 9, 2021. COVID-19 cases have been on a steady increase in the province of British Columbia over the past week. THE CANADIAN PRESS/Jonathan Hayward
A sign indicating face coverings are required by the establishment is pictured on the front door of a business in Vancouver, B.C., Friday, April 9, 2021. COVID-19 cases have been on a steady increase in the province of British Columbia over the past week. THE CANADIAN PRESS/Jonathan Hayward
B.C. to start releasing neighbourhood-specific COVID numbers after data leak

Documents obtained by the Vancouver Sun show cases broken down by neighbourhoods

Provincial health officer Dr. Bonnie Henry and Health Minister Adrian Dix update B.C.’s COVID-19 situation at the B.C. legislature, April 29, 2021. (B.C. government)
B.C.’s COVID-19 case count creeps up, seven more deaths

445 people in hospital, 157 in intensive care

Summerland’s positive test rate is much higher than surrounding local health areas, according to internal BC CDC documents. (BC CDC)
Summerland 3rd behind Surrey, Abbotsford in daily per capita COVID-19 cases

Interior Health is rolling out additional vaccine availability to the community

Amazon is pausing its Prime Day marketing event in Canada this year amid ongoing COVID-19 outbreaks at its facilities in Ontario. THE CANADIAN PRESS/Nathan Denette
Amazon Prime Day halted in Canada due to COVID-19 outbreaks in warehouses

The event was postponed to protect the health and safety of employees and customers, the company says

Ally Thomas, 12, seen in an undated family handout photo, died on April 14 from a suspected overdose. Her family says they are frustrated more public supports weren't available when they tried to get her help. THE CANADIAN PRESS
Minister says suspected overdose death of 12-year-old pushing B.C. to ‘do better’

Minister Sheila Malcolmson of Mental Health and Addictions says the government is working ‘as hard as we can’ to build a system of care for youths

At this Highway 3 check point, police officers will be asking for identification from drivers, documentation regarding the driver’s name and address, and the purpose for the driver’s travel. (RCMP)
No fines handed out at 1st COVID-19 roadblock as checks move across B.C.

Cpl. Chris Manseau says a total of 127 vehicles were stopped at a roadblock in the Manning Park area

A spectator looks on as the Olympic Caldron is relit in downtown Vancouver, Wednesday, February 12, 2020. THE CANADIAN PRESS/Jonathan Hayward
Small majority of B.C. residents in favour of a Vancouver 2030 Olympic bid: survey

A new survey shows a split over the possibility of public money being spent to organize and host the winter games

Junior A team Coquitlam Express is offering all Tri-City residents who get vaccinated against COVID-19 a free ticket to one of their games. (Facebook/Coquitlam Express)
B.C. hockey team offering free tickets to hometown fans who get the COVID-19 vaccine

‘We know the only way to get fans back is people getting vaccinated,’ says Express’ general manager Tali Campbell

Most Read