Norfolk Southern Reviewing CP Offer

Norfolk Southern Corp. acknowledged it has received an unsolicited, low-premium, non-binding and highly conditional indication of interest from Canadian Pacific to acquire the company.

CP offered $46.72 in cash and a fixed exchange ratio of 0.348 Canadian Pacific shares per Norfolk Southern share, representing a premium of less than 10 percent based on closing prices today.

Norfolk Southern’s board of directors, in consultation with its financial and legal advisors, will “carefully evaluate” and consider this indication of interest, Norfolk Southern said in a statement. The company said it would review the offer “in the context of Norfolk Southern’s strategic plans, and its ongoing review of opportunities to enhance stockholder value through strategic, financial and operational measures and pursue the best interests of the Company and its stockholders.”

“Notably, any consolidation among Class I railroads in North America would face significant regulatory hurdles,” Norfolk Southern said in a statement. “Norfolk Southern’s board of directors and management team are committed to enhancing value for all stockholders.  The Company’s stockholders do not need to take any action at this time.”