How Are CP Rail & CNR Stocks Doing Amid Clash Over Kansas City Bid?

3 min read | April 27, 2021 02:46 AM AEST | By Anuj

How Are CP Rail & CNR Stocks Doing Amid Clash Over Kansas City Bid? — Image source: Elle Aon,Shutterstock

How Is Kansas City Southern Responding To CN Rail’s Superior Bid?

Kansas City Southern stated last week, on April 24, that CN Rail’s offer could lead to a better deal than a bid by CP Rail. The US company is said to be in talks with CN Rail, and both could negotiate on the “superior proposal” of US$ 30 billion against Canadian Pacific Railway’s bid worth US$ 25 billion.

However, the US-based rail transportation firm also remained conservative and said that there is no assurance that the discussion with CN Rail would lead to a final deal.

The two Canadian railways are clashing over the acquisition of Kansas City Southern as both are looking for an extended railroad that connects through the US, Canada, and Mexico. This extended railway network would offer benefit from the renewed trade alliance, Canada-United States-Mexico Agreement (CUSMA). Hence, this rivalry could get more unpleasant in the upcoming days.

Let us glance at both the Canadian railway stocks’ price performance.

Stocks of CN Rail Co (TSX:CNR) has entered the bearish zone after the “superior proposal” announcement and fell by nine per cent in the past one week. However, it is still up by 21 per cent for the past year.

The ground transport stock has plunged by seven per cent month-to-date (MTD) and decreased 3.3 per cent year-to-date (YTD).

Shares of CP Railway Limited (TSX:CP) have outperformed CN Rail stock this year, up nearly eight per cent YTD. It also surpassed its rival in the past one-year performance and returned almost 64 per cent. Its stock was trading at C$ 460.28 apiece at the time of writing this (12:3PM).

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