The Canadian National Railways (CN) may face regulatory hurdles in its bid to acquire the US-based Kansas City Southern (KCS), but the management of a Montreal-based company believes most of its key stakeholders are worth the effort.
Apart from billionaire Bill Gates, Cascade holds the largest stake in its investment firm, Cascade (12%), behind Case de Debt at Placement to Quebec (CDPQ) 33, US $ 7 billion. Country.
“Most [des actionnaires] Canadian National President and CEO Jean-Jacques Roost presented the names of Mr Gates and CDPQ during a virtual conference hosted by Bank of America on Wednesday.
DCI Fund Management, CNI’s fifth largest shareholder and largest shareholder in the Canadian Pacific (CB), on Tuesday expressed concern over the mood of shareholders following concerns raised. Roost was asked – it also looks at KCS.
In a letter dated May 3, Mr. Addressed to Roost Press Cayce hopes that CN’s offer, if implemented, will provide “new markets for Quebec exporters” and, in addition, create jobs within a company based in Montreal.
The acquisition is linked to CDPQ’s objectives of supporting Quebec businesses in their international development and their transition to a low carbon economy.
Kim Thomas, Vice President and Investment Chairman, Quebec in Guiz de Dept
The pension plan manager is the ninth largest CN partner, according to data firm Refinitive. He also owns 57,446 KCS shares, or less than 1% of the outstanding securities.
A deadline is approaching
KCS is at the center of a feud between CN and CB, and each of them is eager to get their hands on an American rail carrier, largely because of its rail assets in Mexico. Both railroads each want to own a system to cross the United States and get to that country.
However, time is running out for CB, which will have to officially respond to the KCS board of directors by 5pm on Thursday, which has decided to turn to the CN offer, which it considers high. On March 21, the coal-based rail company announced a $ 25.2 billion deal with KCS.
For its part, CN now owns the Surface Transportation Board (STP) – the U.S. that manages railroad connections. Controller – The voting trust should be set up when the contract is reviewed. Regulatory authorities.
STP If the company refuses its request, it will pay KCS $ 1 billion. If KCS terminates its contract with CB, the rail carrier has already agreed to a bill of US $ 700 million in redundancy fees.
In addition, the SDP said that the project of the Quebec Railroad should be evaluated on the basis of strict rules. Decided, while at the same time granting an exemption to its Alberton rival.
According to DCI Fund Management, a London hedge fund led by billionaire Christopher Hone, these risks could be offset by CNC abandoning its bid for CNC.
“We hope that regulatory risk can be properly managed by taking it step by step,” Roost said.
In a statement released Tuesday, Steve Hansen of Raymond James estimated that the load of evidence on CN was increasing in light of the most recent decision by regulatory authorities.
Nonetheless, the railways said it would not back down from the STP in early June for its voting confidence. Hopes to get approval and hopes to get majority support from KCS shareholders in July. The transaction approval process is expected to last until next year.