CN Files Letter With Surface Transportation Board

     Details why its superior proposal is procompetitive and in best interest of customers

Corrects misleading statements made by Canadian Pacific

MONTREAL, April 23, 2021 (GLOBE NEWSWIRE) -- CN (TSX: CNR, NYSE: CNI) today filed a letter with the Surface Transportation Board (“STB”) regarding CN’s superior proposal to acquire Kansas City Southern (NYSE: KSU) (“KCS”) in a cash-and-stock transaction valued at $33.7 billion, or $325 per share¹. In its letter, CN lays out in detail why its proposal is procompetitive and in the best interest of customers, and corrects misleading statements submitted to the STB by Canadian Pacific Railway Limited.

The following is a copy of that letter:

April 23, 2021

The Honorable Cynthia T. Brown
Chief, Section of Administration, Office of Proceedings
Surface Transportation Board
395 E Street S.W.
Washington, DC 20423

Re:        Finance Docket No. 36500, Canadian Pacific Railway, Ltd., et al.—Control—Kansas City Southern, et al.

Dear Ms. Brown,

I write on behalf of Canadian National Railway Company and its rail operating subsidiaries (“CN”) to respond to yesterday’s letter filing by the “Canadian Pacific Applicants” (“CP”).

As the Board is aware, on April 20, CN submitted a proposal to the Board of Directors of Kansas City Southern (“KCS”) proposing a combination of CN and KCS (the “CN Proposal”). KCS is currently evaluating that proposal under the terms of its merger agreement with CP, which explicitly contemplated a process under which KCS could consider superior offers made by other bidders.

CN is confident that KCS will recognize the value of the CN Proposal and will choose to partner with CN. But that is a choice for KCS and its shareholders to make. Under the terms of the KCS-CP merger agreement, CP has the opportunity to make a competitive counteroffer if it wishes and to make its pitch to KCS for why such a counteroffer would be superior.

Instead of presenting its case to KCS, however, CP resorts to a letter filing in its own transaction docket claiming that a potential CN-KCS combination would be “illusory” and would be “anticompetitive.” Notably, KCS did not join CP in this filing. While this docket is plainly not the right forum to litigate the merits of a CN-KCS combination that KCS is still evaluating, CP’s assertions that the CN Proposal is somehow “anticompetitive” require a response.