Canadian Pacific wants vote on Norfolk Southern deal

OMAHA, Neb. -- Canadian Pacific plans to ask Norfolk Southern shareholders whether they want the two railroads to pursue a merger.

See Full Article

Canadian Pacific said Tuesday that it plans to submit a shareholder resolution on a possible deal at Norfolk Southern's annual meeting this spring. But it doesn't plan to nominate its own slate of directors to press the issue.

Norfolk Southern officials didn't immediately respond Tuesday afternoon.

Norfolk Southern has sternly rejected all of Canadian Pacific's takeover offers even as they approached roughly $30 billion. Norfolk Southern has said the offers have been so "grossly inadequate" that there wasn't much point in discussing a possible deal.

Canadian Pacific has said combining its railroad with Norfolk Southern would create a more efficient operation that could haul more freight and grow profits faster than either railroad could alone. CP also predicts that it could cut roughly $1.8 billion in annual costs.

"Shareholders and analysts will be watching NS closely throughout 2016 and if they continue to underperform, the pressure to work with CP will only grow," said Harrison. "Our model performs in good times and bad, consistently driving shareholder value during the peaks and the valleys."

Norfolk Southern executives have said they believe the railroad will fare better if it remains independent. They have released their own plan to cut about $130 million in costs this year and more than $650 million in annual cost savings by 2020.

Canadian Pacific said it doesn't plan to ask Norfolk Southern shareholders to vote on its most-recent proposal. Instead, it will just ask them to support having the two railroads hold merger talks.

Even if the railroads agreed on a deal, the proposal would still have to clear major regulatory hurdles. The U.S. Surface Transportation Board hasn't approved any major rail mergers since it approved tough rules for them in 2001.

Norfolk Southern officials have said they don't believe regulators would approve such a merger, but Canadian Pacific officials remain optimistic a deal could be approved.

Shares of Norfolk Southern Corp., which is based in Norfolk, Virginia, rose $1.50, or 2.1 per cent, to $71.99 in afternoon trading Tuesday. Its shares are down 33 per cent in the past year.



Advertisements

Latest Economic News

  • Why do you need a pet insurance, right here, right now

    Economic 24news
    Many Canadians would consider their pets as a part of their immediate, granular, family. Although some professionals think it’s not healthy, that’s the way life is in the twenty first century; There is a steep decline in the birth rate globally, with Japan leading the pack, and pets are filling in the void.
  • What really happens to old clothes dropped in those in-store recycling bins

    Economic CBC News
    If you've been to a mall recently you might have spotted something new. Clothing donation bins are popping up in more and more retail chains. Some of the biggest names in fashion have launched take-back programs. Source
  • Tim Hortons franchise owners tell workers to blame Wynne for benefit cuts and to 'not vote Liberal'

    Economic CBC News
    A staff memo written by a couple of Tim Hortons franchise owners in Whitby, Ont., blames cuts to employee benefits on the Ontario government and its minimum wage hike. The notice also suggests employees contact Premier Kathleen Wynne if they have concerns about the changes — and let her know she doesn't have their support. Source
  • Asian shares mixed as U.S. government shutdown threat looms

    Economic CTV News
    HONG KONG - Asian stock markets were uneven and the dollar fell on Friday following Wall Street's retreat as the threat of a U.S. federal government shutdown loomed on the weekend. KEEPING SCORE: Japan's benchmark Nikkei 225 climbed 0.3 per cent to 23,836.84 and South Korea's Kospi was flat at 2,517.19. Source
  • Trees being burned on border of Jasper park to combat mountain pine beetle

    Economic CTV News
    EDMONTON - Foresters and provincial officials are burning tens of thousands of trees east of Jasper National Park to try to slow the spread of mountain pine beetles. "There's a lot more activity in the Edson-Hinton region, higher than past years, as we deal with some of this immigration that's occurring," said Mike Underschulz of Alberta Agriculture. Source
  • NEB sets out dispute resolution process for Trans Mountain pipeline

    Economic CBC News
    The National Energy Board says it has established a process to resolve future permitting issues between the builders of the Trans Mountain pipeline expansion project and provincial and municipal authorities. The NEB says that under the new process, it will take about three to five weeks to reach a decision on future disputes for permits the project is required to get under conditions imposed on the project. Source
  • New dispute resolution rules for Trans Mountain pipeline permits company to skirt local rules, says critic

    Economic CBC News
    An environmental lawyer says the National Energy Board's new process for resolving permitting issues gives Kinder Morgan the ability to circumvent local rules for its Trans Mountain pipeline expansion. The NEB said Thursday it has established a process to resolve future permitting issues between the builders of the Trans Mountain pipeline expansion project and provincial and municipal authorities. Source
  • NAFTA uncertainty could be pausing business investment in Canada: Morneau

    Economic CTV News
    TORONTO -- Bill Morneau says he understands the uncertainty surrounding NAFTA might be causing some companies to hesitate in making investment decisions. The federal finance minister made the comments today when asked about the Bank of Canada's warning this week that elevated uncertainty over the future of the North American Free Trade Agreement would drive down investment in Canada. Source
  • Apple to release software update to resolve iPhone slowdown: CEO Tim Cook

    Economic CBC News
    Apple Inc. will release a software update that will allow users to turn off a feature that slows down iPhones when batteries are low on charge, chief executive Tim Cook told ABC News. Apple will release a test version of its iOS software next month that shows users the health of their batteries and will let them turn off a phone-slowing feature meant to prevent sudden shutdowns in iPhones with older batteries, Cook said in an interview with ABC News on Wednesday. Source
  • Canadian cities reveal how they feel about losing bid for Amazon HQ2

    Economic CTV News
    TORONTO -- Amazon waded through 238 bids that included promises of hefty tax breaks and canoeing to work to narrow down a short list of some 20 candidates, including just one Canadian city -- Toronto. Source