CP - DOJ Calls $30 Billion Railroad Merger Plan a Mockery of Regulation
The Department of Justice has some doubts about a novel merger arrangement between Canadian Pacific (NYSE: CP) and Kansas City Southern (NYSE: KSU) , calling into question whether Kansas City Southern shareholders will get their payout this summer as hoped.
Canadian Pacific (CP) and Kansas City Southern (KCS) last month announced plans to combine in a deal worth more than $29 billion, including debt. With a long, drawn out regulatory approval process expected, CP came up with a plan to put KCS into an independent voting trust ahead of full deal completion.
But in a letter to the Surface Transportation Board filed April 12, a top DOJ official cautioned against the railroad regulator accepting the trust plan without close scrutiny.
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DOJ Calls $30 Billion Railroad Merger Plan a "Mockery" of Regulation