Canadian National Gets Kansas City Southern Deal-Termination Notice
September 15 2021 - 9:25AM
Dow Jones News
By Dave Sebastian
Canadian National Railway Co. said it has received Kansas City
Southern's deal termination notice.
Kansas City Southern said a recent takeover from Canadian
Pacific Railway Ltd. is superior to the one it had accepted from
Canadian National. Canadian National said Wednesday that Kansas
City Southern would pay it a $700 million termination fee as well
as $700 million in the refund for Canadian Pacific's termination
fee.
Canadian National said it isn't obligated to pay any termination
fees.
"While we are disappointed that we will not be able to deliver
the many compelling benefits of this transaction to our
stakeholders, the decision to bid for KCS was a bold and strategic
move that still resulted in positive outcomes for CN," Canadian
National Chief Executive JJ Ruest said. "We believe that the
decision not to pursue our proposed merger with KCS any further is
the right decision for CN as responsible fiduciaries of our
shareholders' interests."
Canadian National's bid suffered a major setback Aug. 31, when
the Surface Transportation Board, a five-member panel that must
bless mergers of freight railroads, ruled that the company wouldn't
be permitted to complete a deal using a temporary voting trust that
was a crucial to part of the offer. The STB ruled that Canadian
National hadn't demonstrated that its use of a voting trust would
be consistent with the public interest.
Write to Dave Sebastian at dave.sebastian@wsj.com
(END) Dow Jones Newswires
September 15, 2021 09:10 ET (13:10 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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