CP Rail to Shift Strategy in NS Bid

January 22, 2016

CP Rail’s Harrison to Shift Strategy in Norfolk Southern Bid

By Frederic Tomesco and Thomas Black, Bloomberg Business

Canadian Pacific Railway Ltd., concerned that mounting political pressure may scuttle its proposed stock-and-cash bid for Norfolk Southern Corp., plans to change strategy to sway lawmakers and reverse the momentum.Website Insert Cars and Financing copy

“When you’re playing the game and somebody changes the rules on you, you have to review your strategies,” Canadian Pacific Chief Executive Officer Hunter Harrison said Thursday on a conference call. “If this is a political contest and we’re going to forget about the process that was designed, and we’re going to let the legislative branch take over, the rules are all changed.”

Federal and state lawmakers, shippers and railroad operators have taken up Norfolk Southern’s cause by writing letters to the U.S. Surface Transportation Board in opposition to any proposed deal — even though a formal evaluation process hasn’t even begun. In response, Canadian Pacific has hired public-relations company Edelman for help and asked the U.S. Justice Department to look into a “collective campaign” against the bid.

 “There’s a lot of moving parts going on here,” Harrison said. “There are some things that have happened, and almost happen daily, that we certainly did not anticipate.”

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