Kansas City Southern shareholders vote in favour of CP Rail takeover

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Market and Business Report May 14 2021
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Kansas City Southern shareholders have voted in favour of the railway’s takeover by Canadian Pacific Railway Ltd.

Shareholders gave the green light at a special meeting Friday that lasted less than 10 minutes, paving the way for the creation of the only single-line rail network connecting Canada, the United States and Mexico.

The approval follows a thumbs-up from Mexican regulators last month and from CP shareholders on Thursday.

CP agreed in September to buy KCS in a deal valued at US$31 billion, including the assumption of US$3.8 billion of debt, following a testy battle with Canadian National Railway Co., which was also looking to acquire the U.S. railroad.

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The U.S. Surface Transportation Board has approved the use of a voting trust for the transaction that allows KCS shareholders to receive payment after shareholders of both companies approve the deal, but before the deal receives final approval.

CP has said it expects the deal, which also changes its name to Canadian Pacific Kansas City Ltd., to close on Dec. 14.

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