Norfolk Southern's stock climbs after Canadian Pacific revises buyout bid

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  1. sniper-academy

    sniper-academy Administrator Staff Member

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    Norfolk Southern Corp.'s stock climbed 2.2% in premarket trade Tuesday, after Canadian Pacific Railway Ltd. revised it's buyout bid for the fellow railroad company. Canadian Pacific said it believes the the revised bid is "financially more attractive and dramatically reduces the regulatory uncertainty" for Norfolk shareholders. Under the new bid, Norfolk shareholders would receive $32.86 in cash and 0.451 shares in a new company, which will own the combined companies. Canadian Pacific estimates the bid to be worth $125 to $140 a share to Norfolk shareholders at the closing of the deal. The previous bid, at the time it was revealed on Nov. 17, worked out to be worth about $94.95 a share. Norfolk said last week that the previous bid was "grossly inadequate." Canadian Pacific said to alleviate regulatory concerns, it was prepared to close the deal into a voting trust. Norfolk's stock has run up 16% over the past three months, while Canadian Pacific's has lost 9.2% and the S&P 500 has gained 5.5%.
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