CPKC Not Interested in Merger, Warns of Risks
Statement Comes After Union Pacific-Norfolk Southern Deal
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North American railroad Canadian Pacific Kansas City Ltd. said it鈥檚 not interested in a merger and warned of potential service disruptions as deal activity picks up across the rail industry.
The company 鈥 itself a product of a mega-merger just two years ago 鈥 said the existing network of six major domestic railroads has shown it鈥檚 capable of delivering 鈥渘ear-seamless transportation services鈥 across the continent.
Future improvements could come through alliances rather than acquisitions, CPKC said in the unorthodox statement Aug. 26.
鈥淎ny major rail merger poses unique and unprecedented risks to customers, rail employees and the broader supply chain,鈥 the company said.
READ MORE:听Lutnick Says Rail Mergers Could Improve Freight Flow
While the statement didn鈥檛 specify a particularly concerning tie-up, it comes about a month after rival Union Pacific Corp. agreed to acquire Norfolk Southern Corp. in a cash-and-stock transaction valuing the company at about $72 billion. The potential merger would form the first domestic transcontinental railroad, and speculation has grown that other railroads would need to combine to remain competitive. Investor Ancora Holdings Group has suggested that CSX Corp. consider a deal with CPKC.
CPKC said today that the company is not interested in participating in immediate rail industry consolidation, despite the suggestions by some that it take part. CPKC does not believe that further rail consolidation is necessary for the industry as currently structured. The鈥 鈥 CPKC (@CPKCrail)
CPKC was formed after Canadian Pacific closed a deal in 2023 for Kansas City Southern valued at about $31 billion. In the Aug. 26 statement, CPKC said it 鈥渋s not interested in participating in immediate rail industry consolidation鈥 but that鈥檚 continuing to pursue industry partnerships.
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