CP Rail says unsolicited bid for Kansas City Southern not superior


Aug 12 - Canadian National Railway Co. said on Thursday its Board determined that the unsolicited proposal received from Kansas City Southern does not constitute a superior proposal to its agreement with the Canadian Pacific Railway Co.

CP Rail presented a new $27 billion offer for U.S. peer Kansas City Southern on Tuesday, lower than a $29 billion rival bid from CN Rail, hoping antitrust concerns over the latter will give it an edge.

It said it continues to recommend shareholders vote for its proposed transaction with CN Rail.

CP Rail Chief Executive Officer Keith Creel refused to raise his $2 billion bid for Kansas City after losing to CN Rail in May, arguing that the deal that Kansas City had chosen to pursue was not real because the Surface Transportation Board would shoot it down.

The STB has yet to rule on the proposed voting trust structure of that transaction. KSU scheduled a special meeting of its shareholders on Aug. 19 to vote on the merger agreement with CN and other proposals.

KSU added that if the STB does not release a special decision before Aug. 17, the public meeting will be adjourned to give all shareholders and the board time to receive and consider the STB decision.