Canadian Pacific clinches $27B Kansas City Southern deal as rival bows out

The combination will create the first direct railway linking Canada, the United States and Mexico, with a network spanning 20,000 miles and approximately $8.7 billion of annual revenue. It marks the end of a high-stakes bidding war.

The $300 per share cash-and-stock deal that Canadian Pacific clinched is higher than the $275 per share cash-and-stock deal that it had secured in March to buy Kansas City Southern. That deal was scrapped when Canadian National wooed Kansas City Southern in May with a $325 per share cash-and-stock offer.

Kansas City Southern shares were little changed at $281.55 in Wednesday trading in New York.

Canadian National suffered a blow when the U.S. Surface Transportation Board (STB) rejected a temporary “voting trust” structure last month that would have allowed Kansas City Southern shareholders to receive the deal’s consideration without having to wait for full regulatory approval.

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Canadian Pacific is acquiring Kansas City Southern to create the first U.S.-Mexico-Canada rail network totaling 20,000 miles of railway. (Source / Canadian Pacific Railway)

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