Kansas City Southern to Combine With Canadian National
May 21 2021 - 11:59AM
Dow Jones News
By Dave Sebastian
Kansas City Southern said it will combine with Canadian National
Railway Co. after deeming the offer as superior over the deal it
had struck with Canadian Pacific Railway Co.
The deal has an enterprise value of $33.6 billion, including the
assumption of about $3.8 billion in Kansas City Southern's debt,
the companies said Friday. The combination would create the first
freight-rail network linking the U.S., Mexico and Canada by
connecting ports in the three countries.
Kansas City Southern shareholders will get $325 a share based on
Canadian National's May 13 offer, comprising $200 in cash and 1.129
shares of Canadian National stock for each Kansas City Southern
share, the companies said. They said Kansas City Southern's
preferred shareholders will get $37.50 in cash for each preferred
share. Kansas City shareholders are expected to own about 12.6% of
the combined company, they added.
The companies said they are confident in their ability to obtain
regulatory approvals, including from the U.S. Surface
Transportation Board and the Federal Economic Competition
Commission and Federal Telecommunications Institute in Mexico.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
May 21, 2021 11:44 ET (15:44 GMT)
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