Canadian Pacific Railway Limited today said exploratory conversations with CSX Corp. about a possible merger have ended, and no further talks are planned.
CP said it proposed an integrated coast-to-coast combination that would improve customer service, promote competition, alleviate congestion in North America – specifically the key Chicago gateway – and generate significant shareholder value. Such a business combination would offer creative alternatives for shippers, greater fluidity, increased capacity and improved efficiency industry-wide, CP said.
While regulatory concerns appear to be a major deterrent for many railroads considering combinations, CP believes that given the right structure between the right players, and having thoughtful considerations and remedies to address shipper concerns, regulatory approvals are achievable. The North American rail industry is confronted today with the challenges of moving more freight than ever and the prospect of moving even more as oil production, crop yields and consumer demand grow alongside the economy. CP is convinced that the significant problems that beset the industry now will only worsen over time if solutions aren’t put in place immediately. A pro-competition, customer-friendly, safety-focused railway combination is one such solution that could not be ignored on its merits by regulators.
CP CEO E. Hunter Harrison during a conference call tomorrow will discuss railroad mergers and acquisitions and the need for a comprehensive North American transportation policy.