CP-KCS merger

HemiAdda2d Mar 21, 2021

  1. HemiAdda2d

    HemiAdda2d Staff Member TrainBoard Supporter

    19,942
    14,649
    243
  2. mmi16

    mmi16 TrainBoard Member

    364
    187
    21
    The STB is the one to have final say in the matter.
     
    Kurt Moose likes this.
  3. Hytec

    Hytec TrainBoard Member

    13,133
    3,938
    183
    Didn't the release say STB had approved it already....?
     
  4. mmi16

    mmi16 TrainBoard Member

    364
    187
    21
    STB was notified at the time the announcement was made to the public.

    The STB will still have to rule on the transaction.
     
  5. gjslsffan

    gjslsffan Staff Member

    2,083
    3,124
    61
  6. BoxcabE50

    BoxcabE50 HOn30 & N Scales Staff Member TrainBoard Supporter

    63,228
    9,916
    652
    Kurt Moose likes this.
  7. Hardcoaler

    Hardcoaler TrainBoard Member

    6,571
    19,069
    104
    CN shares fell 8% today following their announcement that they will bid $33.7 Billion for KCS, topping CP's $25 Billion offer announced a month ago. KCS shares jumped 15%. I guess we should have figured that CN wouldn't sit idly by and be shut out.
     
    Kurt Moose likes this.
  8. acptulsa

    acptulsa TrainBoard Member

    2,413
    2,011
    52
    I see why their price fell. They got the ICG long ago. That's a lot of money to spend on more of what they already have.
     
    Kurt Moose and Hardcoaler like this.
  9. mmi16

    mmi16 TrainBoard Member

    364
    187
    21
    Still to be determined if this is the Financiers version of blind man's bluff. Does CN really want KCS or do they really want CP to have to pay more for KCS and thus hurt their financial abilities to compete with CN after making the higher priced acquisition.
     
  10. Hytec

    Hytec TrainBoard Member

    13,133
    3,938
    183
    Welcome to the world of cutthroat financial negotiations. Just like what we go through with automobile dealers, only for slightly more money. :rolleyes:
     
    Kurt Moose and Hardcoaler like this.
  11. BoxcabE50

    BoxcabE50 HOn30 & N Scales Staff Member TrainBoard Supporter

    63,228
    9,916
    652
  12. Hardcoaler

    Hardcoaler TrainBoard Member

    6,571
    19,069
    104
    This has the makings of the CSX vs NS battle for CR, albeit on a much smaller scale.
     
  13. Hardcoaler

    Hardcoaler TrainBoard Member

    6,571
    19,069
    104
    Good day for rail stocks. At about 1PM:

    NS up 3.2% (new 52 Week High)
    CSX up 4.8% (new 52 Week High)
    UP up 2.0% (new 52 Week High)
    CN up 1.9% to $112 (52 Week High is $119.61)
    CP up 4.2% to $359 (52 Week High is $390.46)
    KCS up 1.3% (new 52 Week High)
     
    Hytec and Kurt Moose like this.
  14. mmi16

    mmi16 TrainBoard Member

    364
    187
    21
    CSX isn't just a 52 week high - it is a ALL TIME HIGH
     
  15. Hardcoaler

    Hardcoaler TrainBoard Member

    6,571
    19,069
    104
    Yep, the whole industry has had a good ride.
     
  16. mmi16

    mmi16 TrainBoard Member

    364
    187
    21
    Feature when all is said and done in the railroad industry there will end up being two carriers -

    CN & CP
     
  17. Hytec

    Hytec TrainBoard Member

    13,133
    3,938
    183
    I suspect you probably are right. Though I don't understand why from a corporate perspective.
    Do you have any insight or experience that leads you to this conclusion?
     
  18. Hardcoaler

    Hardcoaler TrainBoard Member

    6,571
    19,069
    104
    It's probably too early to predict the final merger moves, if they come at all. UP's market capitalization is a whopping $146 Billion, significantly larger than CN's market capitalization of $79 Billion and CP's $49 Billion. CSX's market cap matches CN's at $79 Billion and NS's is nearly the same at $77 Billion.

    With this in mind, I'm doubting that neither CN or CP could engineer a hostile takeover of UP, CSX or NS. Perhaps friendly mergers might someday accomplish it, but ceding control of U.S. rails to a foreign company would be met with a cold reception by U.S. shippers and Congress.

    Given the mind-bending complexity of future mergers on a continental scale, I'm doubtful that anything is on the horizon. But I'd never say never ... :oops:
     
  19. Hytec

    Hytec TrainBoard Member

    13,133
    3,938
    183
    Funny, I don't think of Canada being a "Foreign Country". They always seem to want what's best for everyone in a contract agreement regardless of who had 51% and signed on the top line. Many of my most pleasant and productive programs were with Canadian co-contractors and subs.

    Though with the North American rail network and industry, it definitely might get down and dirty. Consider what Hunter Harrison accomplished. :rolleyes:
     
  20. mmi16

    mmi16 TrainBoard Member

    364
    187
    21
    Just the irony of it all
     

Share This Page