Canadian Pacific Railway on Tuesday revised its bid to buy U.S. railroad operator Norfolk Southern Corp, less than a week after its prior $28.4 billion proposal was rejected — and the new offer was promptly rejected again.
Calgary-based CP said it was now offering $32.86 in cash and 0.451 of a share in a new holding company that would own both Norfolk Southern and Canadian Pacific. To alleviate regulatory concerns, CP said it was prepared to close the transaction using a voting trust.
When activist investor Bill Ackman first approached Canadian Pacific Railway Ltd.’s management about making major changes to the underperforming railway, including hiring a chief executive who had just retired from its closest rival, they were understandably defensive.
In press release on Feb. 6, 2012, responding to a town hall meeting Ackman’s hedge fund had just held for CP shareholders, the company accused Ackman of having no plan, just criticism.
Canadian Pacific Railway Ltd., the second-biggest railroad in Canada, is exploring a takeover of U.S. carrier Norfolk Southern Corp. in a fresh attempt to consolidate the North American industry, according to people familiar with the matter.
Canadian Pacific Railway Ltd. unveiled details of its dramatically reorganized structure Wednesday, centralizing the railroad’s planning under new chief executive Hunter Harrison but also aiming to empower frontline workers to react more quickly to operational challenges and improve relations with its customers.
The unions representing CP’s workers, however, said they were still in the dark about where 4,500 job cuts, to come by 2016 under the plan, will fall.
Canadian Pacific Railway Ltd. said Wednesday it had extended the contract of its chief executive, Hunter Harrison, by an additional year until 2017.
“When Hunter was brought in to lead the transformational change of this iconic company, the agreement was for four years, plus an option for an additional year,” said Gary Colter, CP’s recently-appointed chairman, in a statement.
After burning through his last set of aggressive objectives about two years ahead of schedule, Hunter Harrison said Canadian Pacific Railway Ltd. needs a new five-year plan.
“There’s a lot of runway left here,” Mr. Harrison, CP’s chief executive, said on a conference call Wednesday.
TORONTO/CHICAGO — Veteran railroad boss Hunter Harrison has won over many critics since taking over as chief executive of Canadian Pacific Railway, but he still has unfinished business – creation of a consolidated North American railway – and he is running out of time to do it.
That might explain why CP, Canada’s No. 2 railway with extensive operations in the United States, and the No. 3 U.S. railway, CSX Corp, have been talking about combining, even though such a deal would face tough regulatory barriers and alarm customers.
Canadian Pacific Railway Ltd.’s quest for a record merger depends on a blessing from the same U.S. agency that thwarted the last effort to build a transcontinental railroad.
Chief Executive Officer Hunter Harrison’s target, people familiar with the matter said, is Norfolk Southern Corp., the No. 2 carrier in the eastern U.S. Both companies rallied Monday on news of Canadian Pacific’s interest as investors savored the possible efficiencies in a coast-to-coast operation.
When Hunter Harrison retired as CEO of Canadian National Railway Co. in 2009, he planned to return to his estate in Connecticut and take it easy, focusing on charitable work, his horse-breeding business, and maybe writing a book.
But some people just aren’t very good at taking it easy. Less than two years later, Mr. Harrison was tapped by activist investor Bill Ackman to lead CN’s chief competitor, Canadian Pacific Railway Ltd., and he gladly accepted.