Canadian Pacific Railway Ltd. is moving away from a proxy fight for Norfolk Southern Corp. but still plans to pursue a takeover of the U.S. carrier, a person familiar with the plan said Tuesday.
Canada's second-largest railroad likely won't present an alternative slate of directors at Norfolk Southern's annual meeting, said the person, who asked not to be identified because the deliberations haven't been made public. Instead, Canadian Pacific will probably request a nonbinding resolution on the ballot which would ask the Norfolk Southern board to start talks, the person said.
Canadian Pacific Chief Executive Officer Hunter Harrison is scheduled to speak at an investor conference in Coral Gables, Fla., today, and may make an announcement regarding Norfolk Southern then, the person said. Representatives for Norfolk Southern and Canadian Pacific declined to comment on the plans, which were reported earlier by Dow Jones.
Acquiring Norfolk Southern would allow Harrison to create a coast-to-coast railroad that eliminates rail-car exchanges between the carriers and would enable him to apply his efficiency expertise to Norfolk Southern, which lags behind other large carriers in key service measures. Norfolk Southern's board has rejected proposals from Canadian Pacific -- including one in mid-December that was valued at about $27 billion.
Business on 02/10/2016