Advertisement

U.S. regulator denies CN Rail’s use of trust in deal to buy Kanas City Southern

Click to play video: 'Market and Business Report: August 13, 2021' Market and Business Report: August 13, 2021
WATCH: Market and Business Report: August 13, 2021 – Aug 13, 2021

The U.S. Surface Transportation Board has rejected the use of a voting trust agreement in connection with Canadian National Railway Co.’s proposed takeover of Kansas City Southern Railway.

The board said the proposed voting trust is not consistent with the public interest standard under its merger regulations.

Read more: Kansas City Southern reaffirms support for CN bid, but may delay vote

Earlier this month, Kansas City Southern said it would delay a shareholder vote on its deal to be bought by CN Rail that is set for Aug. 19 if a U.S. regulator didn’t share its decision on a key voting trust by Aug. 17.

The trust would’ve allowed KCS to remain independent while a full review of the transaction is conducted, but shareholders would get paid without having to wait for a final decision on the deal.

Story continues below advertisement
Click to play video: 'Market and Business Report: August 13, 2021' Market and Business Report: August 13, 2021
Market and Business Report: August 13, 2021

The U.S. Surface Transportation Board said it would make a decision on whether to allow CN to use the trust by the end of August.

More to come

Sponsored content