DOJ, DOD oppose CP-NS combination

The Surface Transportation Board, in seeking comments addressing Canadian Pacific’s petition for an expedited declaratory order, has received letters from the U.S. Department of Justice and the Department of Defense-United States Army, Military Surface Deployment and Distribution Command Transportation Engineering Agency, Railroads for National Defense Program opposing CP’s proposed acquisition of Norfolk Southern, and/or CP CEO Hunter Harrison becoming a senior executive at NS.

CP to NS: “Promptly engage in good faith discussions”

Canadian Pacific on March 9, 2016 filed a preliminary proxy statement with the Securities and Exchange Commission (SEC) that outlines the shareholder resolution to be considered at the upcoming Annual Meeting of Norfolk Southern (NS) shareholders requesting that the NS board of directors “promptly engage in good faith discussions with CP regarding a business combination.”

Commentary

CP+NS and the Humpty Dumpty effect

The chasing by suitor Canadian Pacific of grand dame Norfolk Southern has reintroduced to the railroad chattering classes the nebulous term “public interest,” used often and broadly when mergers and other railroad maneuvers requiring regulatory approval are afoot.

CP will seek STB declaratory order

Canadian Pacific on Tuesday, Feb. 16, 2016 announced it will seek a declaratory order from the U.S. Surface Transportation Board (STB) “confirming the viability of the voting trust structure that CP has suggested as part of its proposed merger with Norfolk Southern.”

Introducing CPconsolidation.com

Canadian Pacific on Thursday, Feb. 11, 2016 launched a new website, CPconsolidation.com, purporting the benefits of its proposed acquisition of Norfolk Southern. The website launch came two days after CP notified NS of its intent to submit a resolution to NS shareholders to ask their board of directors to engage in discussions with CP regarding a merger.

Ackman to NS shareholders: I have a way to make you talk with me

In what some industry observers believe may be a final attempt—short of a proxy battle—by hedge fund head Bill Ackman at a hostile takeover of Norfolk Southern, Canadian Pacific on Feb. 9, 2016, notified NS of its intent to submit a resolution to NS shareholders “to ask their board of directors to engage in good faith discussions with CP regarding a business combination transaction.”

Another white paper from Canadian Pacific

Continuing its hostile pursuit of Norfolk Southern, and faced with some stiff political and rail industry opposition in the U.S., Canadian Pacific on Feb. 3, 2016 released a white paper, CP-NS: A Comprehensive Approach to Regulatory Approval “detailing the comprehensive, merit-based process any merger application would be subject to at the Surface Transportation Board,” CP said.

Jason Seidl: Guess who came to dinner

Cowen and Company Managing Director and Railway Age Wall Street Contributing Editor Jason Seidl reports on a recent dinner conversation with “a large private shipper” that focused on the proposed Canadian Pacific-Norfolk Southern merger, rail pricing, railcar sourcing, and the U.S. economy. Following are his observations:

Harrison to Durbin, et al: “There appear to be some misconceptions”

As Canadian Pacific continues to pursue a merger with Norfolk Southern, CP CEO Hunter Harrison sent a response to the members of the Illinois Congressional delegation (all Democrats) who sent a letter to the Surface Transportation Board on De. 14, 2015 expressing concerns about the potential transaction.

Jason Seidl: CVR or not, it’s still mostly about Hunter

According to Cowen and Company Managing Director and Railway Age Wall Street Contributing Editor Jason Seidl, “The addition of a contingent value right (CVR) is Canadian Pacific’s way of providing Norfolk Southern shareholders with an insurance backstop, another effort by the Canadian Class I to put its money where its mouth is.”

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