Canadian Pacific goes public with Norfolk Southern offer

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After its failed bid for US railroad CSX about a year ago, northern counterpart Canadian Pacific (CP) this morning went public with an offer for Norfolk Southern (NS), CSX’s major US east coast competitor. The bid is understood to be worth around $28bn (yep, when it comes to transport company valuations, North American rail companies are the industry heavyweights). CP’s charismatic chief executive, Hunter Harrison, is understood to have released the offer publically (here’s a link to the letter) as a way of going directly to NS shareholders and circumventing the expected opposition from the NS board. On a strategic level, the takeover would create North America’s first genuinely transcontinental intermodal operator, but is also expected to meet opposition from shipper groups and close scrutiny from anti-monopoly regulators.