Canadian Pacific takes its takeover case to Norfolk Southern shareholders

December 18, 2015

By SCOTT DEVEAU And FREDERIC TOMESCO, Bloomberg News, the Richmond Times-Dispatch

Canadian Pacific Railway Ltd. and its activist backer Bill Ackman appealed directly to Norfolk Southern Corp.’s shareholders, urging them to support its sweetened takeover offer or risk getting nothing.Website Insert Cars and Financing copy

Hunter Harrison, Canadian Pacific’s chief executive officer, said he has no qualms about taking its revised bid to a proxy fight if the U.S. company’s shareholders support the deal against the wishes of the Norfolk Southern board.

“If this is going to be a street fight, so be it,” Harrison said Wednesday on a conference call.

Canadian Pacific’s proposal now includes a contingent-value right that provides Norfolk Southern investors an extra payout of as much as $25 a share, or an additional value of up to $3.4 billion, on top of the existing cash-and-stock offer that values Norfolk Southern at about $27 billion.

Harrison, 71, said he believes a proxy fight is likely if Norfolk Southern’s management and board continue to refuse to discuss a takeover. He wants to create a transcontinental carrier by merging Canada’s second-largest railroad with the No. 2 operator in the eastern U.S. The combination would create the third-largest North American railway by revenue.

Click here to read the full story from the Richmond Times-Dispatch.

 

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