Will CP + NS Happen?

[Bob Bufkin]

Was talking with an NS employee today.  He sure doesn't want a CP takeover but would love a BNSF one.  He says BNSF stands for Because NS Failed.

[jmarley76]

BNSF and NS? That is another on my list of could happens...

I would speculate it may end up a Berkshire Hathaway buy out, not a merger. Owned by the same company, operate as separate companies on the books, no STB approval? Or maybe... sounds like a great way to make it happen while avoiding the trials and tribulations of STB approval processes.

[lock4244]

Record profits and a great operating ratio, overvalued?

I would agree CP is overvalued; they are a house of cards that is fast running out of lines to sell or facilities to close. They lack the reach of CN and, in my opinion, the NS purchase, and earlier attempt at CSX, is a do or die move for CP. They do not have the traffic gathering abilities of their competitors, nor the ability to reach as far afield as their competitors. The value of their stock is all the 'Hunter effect' of cutting waste. With little left to cut, they're running out of options beyond generating new business... which is hard for them to do. Oil was one bright spot for them, and the associated hysteria around building pipelines, until the collapse of oil prices.

They've just further downgraded Toronto Yard, transferring blocks to Mtl and London, which has already generated at least one idiotic move of a car from Oshawa to Mtl for marshaling onto the Havelock block for return to Toronto. WTF 

I do not believe CP+NS will happen. It is nothing but bad news for railroading in North America.

[Spikre]

 
  EL and BN had run thrus circa 1970,but that didn't make them a true Transcon.
  even earlier NYC and Santa Fe had run thrus ,but they weren't a Transcon either.
  both EL and NYC/PC had run thrus with CB&Q before 1969,they weren't a Transcon
  either,but they were headed in the right direction.
   when CP Stock is Corrected to True Value they might have to fend off the Vultures,
  but they seem Safe for now.
   using NS Funds to buy NS is a Fools Wet Dream,but isn't that what CP is now ?
     Spikre
     

[Blazeman]

http://www.progressiverailroading.com/norfolk_southern/news/Norfolk-Southern-to-consolidate-into-northern-southern-segments--47478?email=larry.blazynski@arkema.com&utm_medium=email&utm_source=prdailynews&utm_campaign=prdailynews03/02/2016

Note final comment on the release: CP already driving change at NS. Wall Street visits CP, CP tells Wall Street such-and-such  as to what NS should be doing, Wall Street visits NS, asks what they're doing about such-and-such. NS then implements such-and-such. Many instances, such-and-such has been on NS planning and drawing boards, now they get implemented.

For a changeup, CP just reached out to CSX and got the brush off as one can imagine.

[Bob Bufkin]

And now he wants to get ahold of CSX.

[Ed Kapuscinski]

I think Mike is absolutely right. They have to do something to keep the stock price up, and this is all a distraction from their core problems that they aren't equipped to solve.

[jmarley76]

And the plot thickens...

[Scottl]

http://business.financialpost.com/news/transportation/csx-corps-stock-surges-on-report-of-cp-rail-takeover-interest

Resistance is futile 

[jmarley76]

http://business.financialpost.com/news/transportation/csx-corps-stock-surges-on-report-of-cp-rail-takeover-interest

Resistance is futile 

"Harrison has said a merger with an eastern U.S. railroad would create a transcontinental service that would be more efficient and reduce costs."

I think Mike is absolutely right. They have to do something to keep the stock price up, and this is all a distraction from their core problems that they aren't equipped to solve.

Just putting the pieces together...

[Lenny53]

I would agree CP is overvalued; they are a house of cards that is fast running out of lines to sell or facilities to close.

True, but they are way ahead of the game compared to the US roads,  the downturn in commodities will hit hard in 2016 IMO.

[Blazeman]

CP now contemplating law suits against railroads who have come out against the plan. Must like to keep their lawyers busy.

[jmarley76]

Wow, what a collosal waste of money that would be...

[jmarley76]

FedEx has now joined the opposition, full article here:

http://41.media.tumblr.com/8ddd50846696604f1b005e92c7fcae38/tumblr_o3nib1EuJH1tl0cgpo3_1280.jpg

[TLOC]

I having been following this discussion on the forum and with my wife as we do hold stock in BNSF, Union Pacific and CSX. While I am pretty sure the merger will not happen because of the opposing forces. It could be a great deal for CSX stockholders. Any time a premium is made it is worth consideration. We paid $22+ for our stock in CSX, if an offer of $37+ is made the officers of the company must let the stockholders decide. I really don't see why FedX and UPS are concerned about service and pricing. Their shipping services IMHO have gone down and the pricing of those services have risen. The merger should help service from West coast Canadian ports to the USA east coast and should be cheaper than traveling the New Panama Canal.

I do agree we might see a purchase by Berkshire Hathaway of CSX or NS before we see mergers. I think Mr. Buffet can pull that off. He then would have the BNSF management team create a synergy of cooperation between the railroads, without a merger.

It would be interesting to see the mix of CP red and CSX blue on the locomotives though.

Tom