RailRoadFan.com

CN has jumped into the fray with a “superior” offer:

https://www.connectedcontinent.com/

NSSD70ACe wrote: ↑

Tue Apr 20, 2021 7:58 am

CN has jumped into the fray with a “superior” offer:

https://www.connectedcontinent.com/

Let the bidding war begin.

ns8401 wrote: ↑

Tue Apr 20, 2021 8:35 am

NSSD70ACe wrote: ↑

Tue Apr 20, 2021 7:58 am

CN has jumped into the fray with a “superior” offer:

https://www.connectedcontinent.com/

Let the bidding war begin.

If nothing else, it will force CP to raise their bid. I doubt the STB would approve a CN-KCS merger as easily as CP-KCS because CN and KCS are already parallel though the heartland, versus CP-KCS being a true end-to-end merger. A CN-KCS merger would effectively lock CP out of the Gulf/Mexican markets and create uneven competition.

I’m fine with CP-KCS, but not really CN-KCS. But I bet the plan is to force their competitor to pay more, and perhaps earn concessions beneficial to CN, including perhaps more favorable access to Mexico.

The battle of the Canadian giants continues. CN is submitting a bigger and better financial offer to KCS than CP has offered. I don’t see this happening because KCS has already agreed to terms with CP, but you never know.

It’s interesting that CN’s argument for being a better partner with KCS really comes down to Michigan and Chicago. CN has a very valid argument that CN + KCS would be better for shippers because they could provide single railroad access from Mexico to Michigan and Eastern Canada. While I don’t think the STB would approve a CN + KCS merger, it’s interesting that a lot of this comes down to who owns trackage in Michigan and can access eastern Canada on their own rails.

At the same time, a CN + KCS merger wouldn’t provide as good of synergies if you were shipping from Western Canada to Texas or Mexico, however I don’t think there is much traffic on that lane. I think the Mexico-Michigan-Ontario lane is busier due to auto parts being made in Mexico shipping up to assembly plants here.

Will be interesting to see what happens! CN would also keep the KCS name and brand, so to us railfans, KCS would stick around. We just might see more KCS power here in Michigan on the CN tracks.

https://www.connectedcontinent.com/?fbc ... vXxzZ9QIxw

Saturnalia wrote: ↑

Tue Apr 20, 2021 8:38 am

ns8401 wrote: ↑

Tue Apr 20, 2021 8:35 am

NSSD70ACe wrote: ↑

Tue Apr 20, 2021 7:58 am

CN has jumped into the fray with a “superior” offer:

https://www.connectedcontinent.com/

Let the bidding war begin.

If nothing else, it will force CP to raise their bid. I doubt the STB would approve a CN-KCS merger as easily as CP-KCS because CN and KCS are already parallel though the heartland, versus CP-KCS being a true end-to-end merger. A CN-KCS merger would effectively lock CP out of the Gulf/Mexican markets and create uneven competition.

I’m fine with CP-KCS, but not really CN-KCS. But I bet the plan is to force their competitor to pay more, and perhaps earn concessions beneficial to CN, including perhaps more favorable access to Mexico.

That seems like the most likely scenario to me. Bluffing to try to get some things out of it.

bnsfben wrote: ↑

Tue Apr 20, 2021 8:46 am

The battle of the Canadian giants continues. CN is submitting a bigger and better financial offer to KCS than CP has offered. I don’t see this happening because KCS has already agreed to terms with CP, but you never know.

The KCS Board of Directors has a fiduciary duty involved here. If they don't take the best offer, they're subject to being sued for breach of their fiduciary duty by one or more of the KCS stockholders.

BUY KCS STOCK NOW LMAO

GTW Dude wrote: ↑

Tue Apr 20, 2021 9:42 am

BUY KCS STOCK NOW LMAO

That train has left the station unless you know another railroad is going to make a bid

CN has entered the fray... not sure how bad they want it or if they are just trying to stonewall CP. I feel like with the overlap of the old IC down by the gulf they would face a lot more regulatory hurdles, however the Flint, Holly and South Bend Subs would be one of the busiest mainlines in the country with a CN-KCS merger.

The rivalry seems to be peaking between the big Canadian Giants... was it like this when CSX and NS were going after Conrail?

MQT1223 wrote: ↑

Thu Apr 22, 2021 7:28 pm

CN has entered the fray... not sure how bad they want it or if they are just trying to stonewall CP. I feel like with the overlap of the old IC down by the gulf they would face a lot more regulatory hurdles, however the Flint, Holly and South Bend Subs would be one of the busiest mainlines in the country with a CN-KCS merger.

The rivalry seems to be peaking between the big Canadian Giants... was it like this when CSX and NS were going after Conrail?

It is exciting to watch this happen! I, however, want to see KCS stay Independent!!!! Well if CN keeps their name that is better! Or will it be like all other railroads CN has bought? Hopefully not! I don't want to see re-paints in "CN" paint with "KCS" sublettering! WOW!!!! If this is rejected by the STB, does that mean CP may then get it?
Well, let's not get ahead of ourselves HAHA!!!!

The STB can deny the purchase of KCS by both CN and CP.
The Department of Justice will consider if the purchase by either CN or CP is in compliance with anti-monopoly and other laws.
Of course there is always the possibility of various court actions.
So yes, you're getting ahead of yourself

MQT1223 wrote: ↑

Thu Apr 22, 2021 7:28 pm

CN has entered the fray... not sure how bad they want it or if they are just trying to stonewall CP. I feel like with the overlap of the old IC down by the gulf they would face a lot more regulatory hurdles, however the Flint, Holly and South Bend Subs would be one of the busiest mainlines in the country with a CN-KCS merger.

The rivalry seems to be peaking between the big Canadian Giants... was it like this when CSX and NS were going after Conrail?

Yes it was similar then.

I’m very interested to see what the STB has to say about this. The STB is responsible for ensuring monopolies aren’t formed and that there is enhanced competition. They also are responsible for ensuring the merger has a positive impact on shippers.

In my opinion, I think CP-KCS is more favorable for competition, but the CN-KCS is more favorable to shippers. To me, there isn’t a perfect solution.

Hoping this is not a dumb question here, but since both CP and CN both want KCS, and there seems to be pros and cons to either railroad acquiring KCS, is it possible that KCS could be split up among both CP and CN, much like Conrail was with NS and CSX??

Even if CP gets KCS, CN is still eating CP's lunch. They have the tunnel in Pt. Huron, the "J" around Chicago and CP has to run its stuff via Elkhart. They may finally purchase the P. M. thru Grand Rapids. Okay guy's, shoot a hole in this!

David Lang wrote: ↑

Tue Apr 27, 2021 5:31 pm

Hoping this is not a dumb question here, but since both CP and CN both want KCS, and there seems to be pros and cons to either railroad acquiring KCS, is it possible that KCS could be split up among both CP and CN, much like Conrail was with NS and CSX??

I don't think they could really split KCS like that did with Conrail. Big Blue had a "big X" route structure, with an Albany-St Louis and Philly-Chicago set of lines crossing in Cleveland. Ultimately it made operational sense to give Albany-St Louis to CSX and NS got Philly-Chicago. This made sense in terms of adding good routes to complement the existing networks and keep competition balanced. I guess I just don't see where KCS offers a similar opportunity, and with the CN already owning the IC, even a split like that would leave CP disadvantaged to CN.

This is not to say that perhaps the CN may pry off a piece as a concession, but I doubt it would be a Conrail-like split.

dave989 wrote: ↑

Tue Apr 27, 2021 9:05 pm

... They may finally purchase the P. M. thru Grand Rapids. Okay guy's, shoot a hole in this!

My Opinion... Shoot Away

I don't think CSX is gonna let the PM Go anytime soon, Once Coal Profits from J.H. Campbell start to slip, maybe, But even then, CP is still gonna run on the NS regardless. I mean, They could maybe put in a Diamond at Porter and sell off the Porter Branch and run to the IHB? But I'm not sure of the Logistics of all of that, And I doubt CP would pay for all that improvement just for their 6 Daily Run Through Trains and whatever the GR and Plymouth Produce.

You’d have to think that CP’s recent outright purchase of the Detroit Windsor tunnel was in anticipation of this KCS merger. With full control of the tunnel and a KCS merger, I’d fully expect them to either improve the clearance of the existing tunnel to fit double stacks, or build a new tunnel, just like CN did in Port Huron.

bnsfben wrote: ↑

Wed Apr 28, 2021 8:00 pm

You’d have to think that CP’s recent outright purchase of the Detroit Windsor tunnel was in anticipation of this KCS merger. With full control of the tunnel and a KCS merger, I’d fully expect them to either improve the clearance of the existing tunnel to fit double stacks, or build a new tunnel, just like CN did in Port Huron.

Most of the tunnels length is a tube.
They are a cast iron tube sunk to a trench in the riverbed, connected, pumped dry and then lined with concrete.
They shaved as much concrete out of the one tunnel that they could.
Autoracks and double-stacked 8'6" containers can make it through. A double stack with at least one 9'6" container will have problems.

Talk wrote: ↑

Wed Apr 28, 2021 7:42 am

dave989 wrote: ↑

Tue Apr 27, 2021 9:05 pm

... They may finally purchase the P. M. thru Grand Rapids. Okay guy's, shoot a hole in this!

My Opinion... Shoot Away

I don't think CSX is gonna let the PM Go anytime soon, Once Coal Profits from J.H. Campbell start to slip, maybe, But even then, CP is still gonna run on the NS regardless. I mean, They could maybe put in a Diamond at Porter and sell off the Porter Branch and run to the IHB? But I'm not sure of the Logistics of all of that, And I doubt CP would pay for all that improvement just for their 6 Daily Run Through Trains and whatever the GR and Plymouth Produce.

Traffic is way up, especially with grain biz doing what it’s doing.