Kansas City Southern will get Canadian Pacific Railway
Kansas City Southern declared Sunday that it has consented to sell to Canadian Pacific Railway, making the first rail network however Canada, the U.S. and Mexico.
Following the consolidation, common shareholders of Kansas City Southern will get 0.489 of a Canadian Pacific share and $90 in cash for every Kansas City Southern common share held, giving Kansas City Southern shareholders ownership of 25% of Canadian Pacific’s remarkable stock.
The combined network’s new single-line offerings will deliver extended market go after clients served by CP and KCS, give new competitive transportation service options, and support North American economic growth, as indicated by a release. The transaction is likewise expected to take jobs across the combined network.
While staying the smallest of six U.S. Class 1 railroads by revenue, the consolidated organization will be a lot bigger and more competitive network, working around 20,000 miles of rail, utilizing near 20,000 individuals and creating total revenues of around $8.7 billion dependent on 2020 actual revenues, as indicated by a release.
The new organization will be called Canadian Pacific Kansas City, with four KC Southern directors joining an extended board.
“This transaction will be transformative for North America, providing significant positive impacts for our respective employees, customers, communities, and shareholders,” said CP President and Chief Executive Officer Keith Creel. “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.”
Kansas City Mayor Quinton Lucas tweeted Sunday morning following the declaration.
“Kansas City Southern has been a vital part of the business and cultural fabric of Kansas City since the 1880s, proudly sharing our name as leaders in international trade. We stand with their employees and leadership as we enter the next potential phase of a great Kansas City firm.”