KANSAS CITY, Mo. — Canadian Pacific hopes to complete its $31 billion acquisition of Kansas City Southern railroad before the end of next year.
Shareholders of both companies are likely to vote on the deal sometime in December, and then Mexican and American regulators will have to sign off on the combination before the two railroads can merge.
Officials from both railroads provided an update on the timing of the deal Thursday in a call with investors a day after announcing they had finalized their merger agreement.
Canadian Pacific CEO Keith Creel said the Mexican review of the deal is expected to take between two and four months. After that is complete and if shareholders of both railroads approve, then a voting trust will be created to acquire Kansas City Southern and own it during the U.S. Surface Transportation Board's full review. That is the point when KCS shareholders would be paid.
Creel said he hopes the STB review of the deal will wrap up in October or November of next year and allow the two railroads to combine, but the regulatory review could take longer.
If it is approved, Canadian Pacific's acquisition of Kansas City Southern will be the first merger of two of the continent's seven largest railroads since the 1990s.
The combined company, based in Calgary, Alberta, Canada, is expected to employ about 20,000 people and it will maintain major U.S. operations centers in the Minneapolis and Kansas City areas.
