(Calgary) Canadian Pacific Railway announced on Tuesday that it has completed the acquisition of Kansas City Southern and placed the shares of the US railway in a voting trust while it waits for the US Surface Transportation Board (STB) to complete his review of the agreement.
The trust allows KCS shareholders to be paid while ensuring that the railway operates independently until the U.S. regulator renders its decision on the deal valued at $ 31 billion, including the assumption of 3.8 billion in debt.
Upon completion of the acquisition, KCS shareholders will receive 2,884 CP shares and US $ 90 in cash in exchange for each KCS common share they hold. Preferred share holders will receive US $ 37.50 in cash for each of their security.
CP said the combination with KCS would create the only rail network connecting Canada, the United States and Mexico.
The Canadian Railroad expects the STB’s review to be completed in the fourth quarter of next year.
However, the expected benefits of the merger will not be realized until the US body approves the deal, the CP said.