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CP says it offers a ‘sizable premium’ for NS
I have never approved the merger of AT&SF Railway with Burlington Northern. And now this.
Anyone old enough to remember the merger between the Pennsylvania Railroad and the New York Central knows the disastrous results.
E. Hunter Harrison’s offer to Norfolk Southern is as suspicious as a used car salesman and a politician. I hope Norfolk Southern and its shareholders see this offer for what it really is. I would hate to see NS business trains lose their beautiful Tuscan red livery and yellow-gold trim.
You can’t compare the Penn Central merger to CP/NS. It is acompletely different economic situation.
There is not a “premium offer” high enough to allow E. Hunter Harrison and his “crew” to purchase NS. My stock shares are few but I want to keep them in the NS name at this point. Now if UP or BNSF came calling for a merger, that might well be a different situation. CP is not a good fit with NS in my opinion, especially when Mr. Harrison is involved.
Don’t believe the lies of a snake oil salesman.
This is only the first notes of the opening overture…this whole thing has a long, long way to run yet. My guess is that NS isn’t even EHH’s primary target. He and the rest of his hedge fund buddies have something else completely in mind. And remember, in the financial world you can make as much or more from a failed takeover deal then one that actually goes through…
What CP said: “We’ll only do this if both parties are agreeable”
What CP did: Went public with the proposal.
What’s next?
Perhaps none of you remember the fiascoes engendered by Union Pacific’s swallowing the C&NW and the SP. I was there for both.
The government made it clear at that time they would not allow another meltdown of service to happen.
Why would TRAINS even suggest such a laughable monopoly as this would be allowed ?
Hunter, you are seen as a transplanted Yankee trying to buy up what is essentially a Southern railroad in culture. Not a good idea, IMHO. You are looking at the former Conrail assets for end-to-end purposes and Northeast market penetration but the rest of the railroad south of DC fits better with UP or BNSF. God forbid that BNSF become NS’ dancing partner, as Warren Buffet has enough loose change to buy NS if he wants to. That leaves UP and CSX to get together. KCS?. They might get bigger with swapped assets given them by the STB as a result of mergers but they are vulnerable if CP does not buy them out for a north-south connection. CN? You get left out because of the Canadian connection and the Canadian corporate head office legal requirement. CP could move their current corporate HQ south of the border in a flash post-merger and the Canadian government cannot stop it. That is not a win-win proposition for rail in Canada, and I am a Canadian, as it happens. For my US friends, I hope you now realize what Conrail’s disappearance means to competition in freight rail ops if another round of mergers is in the works. I await reaction from the Obama administration. Will they let this fly or shoot it down a year ahead of the presidential election and risk congress getting involved is the question. Fun times ahead, folks.
CP argues that the merger will ease freight congestion in Chicago. What volume does CP currently interchange with NS? If that is not significant, then there is no service justification for the merger – only the ego boost CP would get for being able to claim being a transcontinental (however little transcontinental traffic they would actually carry. Even a “substantial” interchange would prove nothing if traffic through Buffalo would have to backtrack. What CP really needs to show is how system-wide a new CP would dramatically improve service to shippers. And that I seriously doubt they can do.
CP is ready to buy NS to create largest RR in NA!!
Why does it have to be 2017? Why buy it when you have the money to do so right now? CP has all the money in the world to purchase the troubled Norfolk Southern. And when 2 years go by, NS might lose so much profit, they might go bankrupt and might not merge in time.
For tax reasons I’d think cp keeps the hq in canada
Ad a small time ns stock owner I also oppose the deal. Bnsf would be preferred
I don’t know how much CP interchanges with NS in Chicago, but I am pretty sure there are some unit crude oil trains as well as general merchandise. CP’s route though Chicago is very slow and congested. One alternative would be to route traffic through Canada and Buffalo. Another is to contract Iowa Interstate to bridge the gap between CP at Davenport, IA and NS at Peoria, IL. However, both of these routings would be possible without a merger.
If I’m not mistaken, a CP-NS merger would give the combined railroads control over the Indiana Harbor Belt. It would probably disappear in much the same fashion as the EJ&E has.
What options would BNSF / UP / etc have in Chicago if IHB goes away (to CP/NS)
… nothing less than a 50/50 merger under a ‘new company’; benefitting both roads/investors as Pan Canal widening to open in '16; Atl/Pac recieving/shipping should enhance stock/devidend value for certain as I understand/see it.