Canadian National Railway Stock Price, News & Analysis

CN (NYSE: CNI) and Kansas City Southern (NYSE: KSU) have co-authored an op-ed emphasizing the benefits of their proposed merger. They argue that this combination will enhance infrastructure efficiency, benefiting U.S. manufacturers and expanding the reach of agricultural producers. Notably, they claim a shift from truck to rail will save 260,000 tons of CO2 annually. Additionally, they advocate for the approval of a plain vanilla voting trust, which would maintain KCS's independence during regulatory reviews and uphold its financial health.

The recent op-ed by CN's CEO, JJ Ruest, and KCS's CEO, Patrick J. Ottensmeyer, emphasizes the economic benefits of their potential merger.

They argue that the merger will optimize supply chains and enhance competition across North America, benefiting sectors like manufacturing, agriculture, and construction. Environmental advantages are highlighted, with significant CO2 emissions reductions projected by shifting freight from trucks to rail. Additionally, they advocate for the approval of a proposed plain vanilla voting trust to ensure KCS's independence during regulatory reviews.

The International Brotherhood of Boilermakers has filed a letter with the Surface Transportation Board (STB) supporting the proposed voting trust agreement between Canadian National (CNI) and Kansas City Southern (KSU). This pro-competitive combination is expected to enhance job creation, capital investment, and revenue growth. The voting trust will maintain KCS's independence while ensuring financial health during the STB's review. CN plans to divest overlapping routes, ensuring a seamless end-to-end network. Stakeholders have until June 28, 2021, to comment on the application.

The International Brotherhood of Boilermakers (IBB) has expressed support for Canadian National Railway (CNR) and Kansas City Southern's (KSU) proposed voting trust with the Surface Transportation Board. This endorsement highlights the job creation and revenue growth potential from the CN-KCS combination. The proposed voting trust structure is similar to one previously approved for Canadian Pacific Railway and ensures KCS's financial health during the review process. The companies aim to complete their combination by June 28, 2021, with a commitment to preserve existing routes and job security.

CN and Kansas City Southern (KCS) announced support from three local SMART unions for their proposed voting trust, emphasizing benefits for organized labor. The letters, representing over 1,800 conductors, showcase strong backing for the CN-KCS combination. The proposed trust aims to ensure KCS's independence during the Surface Transportation Board (STB) review while maintaining its financial health. Additionally, CN plans to divest overlapping lines to enhance competition. This partnership is expected to boost job creation and growth opportunities across North America.

CN (CNI) and Kansas City Southern (KSU) are striving for regulatory approval to combine, supported by an op-ed from former STB Chief Economist Dr. William Huneke. He emphasizes that CN's commitment to keep gateways open will enhance rail-to-rail competition, benefiting shippers with fair pricing and services. Approval of the CN/KCS voting trust by the STB is crucial for this merger to materialize. The merger aims to eliminate competitive overlaps and create a stronger network for more efficient rail competition against major carriers.

CN (CNI) and Kansas City Southern (KSU) announced a pro-competitive merger proposal, highlighted by Dr. William Huneke's op-ed in Railway Age. He emphasizes the benefits of maintaining open rail gateways post-merger, which encourages lower rates and improved service. Approval from the Surface Transportation Board (STB) for the CN voting trust is essential for realizing these benefits. The merger is expected to enhance rail-to-rail competition without competitive overlaps, allowing CN/KCS to better compete against dominant carriers like Union Pacific and BNSF.

Support for CN and KCS Combination Grows

On June 17, 2021, CN (CNI) and Kansas City Southern reported an increase in support for their proposed combination, with over 1,500 letters filed with the STB. Of these, 90 letters endorse CN’s voting trust agreement, vital for maintaining KCS's independence during the regulatory review. The combination aims to enhance service efficiency and trade, benefiting stakeholders across North America. Notably, CN has pledged to divest a key overlapping rail segment to ensure the pro-competitive nature of this deal.

Canadian National Railway and Kansas City Southern have received over 1,500 letters of support for their proposed merger, with 90 specifically backing the voting trust agreement. This trust maintains KCS's independence and financial health during regulatory reviews. CN plans to divest a 70-mile overlapping line to enhance competition. Stakeholders, including U.S. Representative Jerry Carl and the Port of Gulfport, endorse the merger, citing benefits for trade, sustainability, and economic prosperity. The public comment period for the merger is open until June 28, 2021.