Organizers in Mexico approved the proposal Canadian Pacific Railway In exchange for $31 billion to acquire the company Southern Kansas City And the construction of a railway linking Mexico, the United States and Canada.
The companies said they had obtained regulatory oversight approvals required by Federal Economic Competition Commission From (Cofece) and Federal Institute of Communications (IFT) from Mexico to incorporate.
The agreement can be completed in the middle Dec If the shareholders of the two companies agree. If so, Kansas City Southern will remain in the hands of a voting fund while the US Surface Transportation Board (STB) conducts its lengthy review of the transaction, but the shareholders will be paid out immediately.
The agreement includes 2,884 Pacific Canadian shares and $90 in cash for each shareholder. In addition, this company will take on debts estimated at about $ 3.8 billion from the southern city of Kansas City.
The companies said on Friday that STB’s review of the deal is expected to continue the fourth chapter Next year.
Major railroad mergers have not been approved by US regulators since the 1990s, so it is unclear whether such a deal will ever be approved. But executives from Canadian Pacific and Kansas City Southern said they expect the deal to go through.
“This historic combination will add capacity to the US rail network, create new competitive transportation options, support North American economic growth, and deliver significant benefits to customers, employees and the environment,” said Keith Creel, CEO of Canadian Pacific.
This year, Canadian Pacific outperformed Canadian National’s $33.6 billion proposal to acquire Kansas City Southern, even though Canadian National is offering more money, as STB refused to agree to part of STB’s plan to buy the Missouri-based company. .
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