Canadian Pacific Railroad Corporation is one step closer to receiving regulatory approval for its acquisition of Kansas City Southern (KCS).
Calgary-based railroad said Tuesday that its acquisition of KCS has received the necessary approvals from the US Foreign Investment Commission.
However, the deal, which will be the only single-track railroad connecting the United States, Mexico and Canada, is subject to approval by the US Surface Transportation Board (STB), which is currently considering the deal.
CP said early next year he expects a decision from the STB.
Last year, Canadian National Railways withdrew a rival takeover bid for KCS after the Surface Transportation Board rejected its request for a voting trust.
CP then agreed to buy KCS in a contract worth US$31 billion, including the assumption of US$3.8 billion in debt.
CP's transaction closed in December, but KCS' shares were placed in a voting trust that would allow U.S. railroads to operate independently while the STB completed its review. rice field.
Mexican regulators have already approved the transaction.
CP says the acquisition of KCS will enable significant growth for its rail customers, moving 60,000 trucks off the road annually.
After closing of the transaction, CP expects the transaction to generate annualized synergies of $1 billion over his first three years.
