CALGARY, Alta.–Canadian Pacific Railway Limited has filed a preliminary proxy statement with the Securities and Exchange Commission (SEC), which outlines the shareholder resolution to be considered at the upcoming Annual Meeting of Norfolk Southern (NS) shareholders requesting that the NS board of directors promptly engage in good faith discussions with CP regarding a business combination.
CP has proposed a merger with NS that would create an integrated transcontinental railroad “with the scale and reach to deliver unsurpassed levels of safety and service to the customers and communities of both companies,” CP claims.
“This is an opportunity for NS shareholders – who have been telling us since the beginning that they are in favour of the proposed business combination – to speak up and be heard by NS’ board of directors,” said CP CEO, E. Hunter Harrison. “We are not asking NS shareholders to vote on the business proposal itself, but to vote in favour of the shareholder resolution calling for NS to engage in good faith discussions with CP regarding a potential combination.”
The shareholder resolution provides a means for NS shareholders to demonstrate, in a coordinated and clear manner, their support for NS to engage in a meaningful dialogue with CP regarding a possible business combination between the two companies.
In its preliminary proxy statement, filed with the SEC on February 29, 2016, NS expressed, for the first time publicly and only after CP submitted notice of its intent to propose the shareholder resolution, a conditional willingness to engage with CP, stating that “in the event that [CP] addresses [Norfolk Southern’s] concerns by receiving a declaratory order from the STB validating its proposed voting trust structure and indicates a willingness to meaningfully increase the value represented by its proposal, Norfolk Southern would be willing to enter into good faith discussions with [CP] regarding the potential combination of the two companies.”
To date, NS has refused to meet with CP to discuss the merits of a potential transaction.
“CP is seeking a declaratory order from the Surface Transportation Board and we have consistently indicated that we are open to discussing the terms of our previous offers,” Harrison said. “With a vote ‘for’ the shareholder resolution, we hope to get NS to the table to discuss all the elements of the proposed business combination in an open and constructive manner.”
CP is making no recommendation concerning any other matter to be brought before NS’ Annual Meeting, for which a date has yet to be set.
Whether or not an NS shareholder plans to attend the Annual Meeting, CP urges all NS shareholders to vote “FOR” the proposed resolution described in the proxy statement by signing, dating and returning the GREEN proxy card at the appropriate time.