Tuesday, October 8, 2024

Canadian Pacific buys a large American company

Must read

Maria Gill
Maria Gill
"Subtly charming problem solver. Extreme tv enthusiast. Web scholar. Evil beer expert. Music nerd. Food junkie."

Canadian Pacific has entered into an agreement to acquire a major US competitor, Kansas City Southern, with the potential goal of creating a network connecting Canada, the United States and Mexico.




The Canadian Press

The two companies announced Sunday that the Canadian company will acquire Kansas City Southern for about $ 25 billion (31 billion treasures).

Under the deal, the shares of the U.S. company will be valued at $ 275, which is a 23% premium over Friday’s closing prices.

Kansas City Southern shareholders will receive 0.489 Canadian Pacific Railway shares and $ 90 in cash per common share.

The deal will need to be approved by the US authorities. This review is expected to be completed by mid-2022.

According to the companies, it could allow the construction of the first railway network connecting the three North American countries.

The President and CEO of Canadian Pacific, Keith Creel, said the deal will be an engine for change in North America with significant positive benefits for employees, customers, communities, and shareholders of both companies.

It would also make it possible to integrate supply chains on the continent, a priority that has become imperative since the signing of the free trade agreement between the three countries.

According to a press release, the newly merged company will operate more than 32,100 km of railroads and will generate a combined revenue of approximately $ 8.7 billion based on 2020 data.

The two networks will meet in Kansas City. The new entity will have operations throughout Canada, the US Midwest, the Northeast, and the South Central United States and Mexico.

See also  As World Hydrography Day approaches, the Government of Canada supports women in hydrography

The company in this article: (TSX: CP, NYSE: CP, NYSE: KSU)

Latest article