CP Rail and Kansas City Southern are making headlines right now with their recent plans for a merge. CP Rail has agreed to buy Kansas City Southern for $25 billion. The CP Rail and Kansas City Southern merger is expected to work toward creating a 20,000 mile rail network that would extend across the U.S., Mexico, and Canada. The recent merger between CP Rail and Kansas City Southern effectively works to create the very first network that can cut through all three North American countries.
The First Rail Network To Extend Through Mexico, Canada, and the U.S.
This would help CP Rail be able to further extend and reach into Mexico and those with CP Rail have reportedly had their eye on Kansas City Southern for some time now. They have been waiting to make this historic move. With this move they will be able to extend their reach for their customers well into Mexico and around the U.S. and this marks the biggest purchase of a U.S. asset that has been made by a Canadian company since back in 2016.
The news of Canadian company CP Rail buying Kansas City Southern has gone viral, being a historic merge between the two and making such an expansive network for the company now that extends to Mexico.
Canadian Pacific Railway is going to make the $25 billion dollar move that will allow them to fully acquire Kansas City Southern and effectively go on to create the first rail network that will connect these regions together. That is why this is a historic merge between the companies, with CP Rail making this buy move.
As far as where they might be operating from, it’s believed that the operations will be based out of Calgary, and there will be another US based operations in Kansas City and one more in Mexico City.
The United States-Mexico-Canada Agreement is going to provide the governing roadmap for the move and this is something that already went into effect which at the time replaced the North American Free Trade Agreement. The move from CP Rail to buy Kansas City Southern is going to mean that there will be no job losses for the company in Calgary, as a result of that move, according to the company.
CP Rail have stated that this will be nothing but positive news for the Calgary region and they have no plans for consolidation right now, they mentioned in a recent statement to the public on the matter.
The Canadian Pacific move to buy Kansas City Southern is going to create an historic an expansive network that spans three countries in North America. There will be a new name as well and that is expected to be Canadian Pacific Kansas City now that the merge is going through, or CPKC. As far as how big the company is going to be now, it’s expected that overall there will be 20,000 employees working with Canadian Pacific Kansas City.
This is an historic move for a Canadian company to buy this U.S. asset and we haven’t seen something like it for several years, according to Bloomberg it hasn’t been seen since Enbridge bought Spectra Energy several years ago.
This isn’t the first time that CP Rail has looked at U.S. railroads at the potential for joining into a transcontinental network. The chief executive of Canadian Pacific has said that he expects they will see support ffrom Kansas City on this merger. Not only that, but that the lack of rail-line duplication is likely to help minimize regulatory concerns related to the matter.
According to the president and CEO of CP Rail, the competition that they anticipate to inject into the North American transportation market cannot happen soon enough, they expect to play a growing and significant role in the North American trade arena.
Still, the combination is going to need the approval of the US Surface Transportation Board. This is expected to happen by 2022 and it isn’t the sort of merger that they think will raise concerns.