North America - KCS said on Thursday its board determined that the unsolicited proposal received from CP does not constitute a "superior proposal" to its agreement with CN.
 
CP presented a new US$27 billion offer for U.S. peer KCS on Tuesday, lower than a US$29 billion rival bid from CN, hoping antitrust concerns over the latter will give it an edge.
 
Below are the events that unfolded over several months as CN and CP locked horns to take control of KCS to create the first railway spanning the United States, Mexico, and Canada, as they stand to benefit from a pick-up in trade.
 
MARCH 21: CANADIAN PACIFIC AGREES TO ACQUIRE KANSAS CITY SOUTHERN
 
CP agreed to acquire KCS in a US$25 billion cash-and-stock deal, which would be the largest ever combination of North American railways by transaction value.
 
MARCH 22: FARM GROUPS SHOW SUPPORT FOR CP/KCS DEAL
 
Farm groups said CP's deal to buy KCS would create a rail network from Canada to Mexico that could smooth the flow of their goods to market.
 
APRIL 20: CN TRUMPS CP'S OFFER
 
CN offered to buy KCS for about US$33.7 billion, trumping CP's buyout offer for the railroad operator. CN said it was willing to match the terms of CP's offer for KCS.
 
APRIL 21: CN KICKS OFF REGULATORY APPROVAL PROCESS FOR KCS DEAL
 
CN informed the Surface Transportation Board (STB), which oversees freight rail service and rates in the United States, that it planned to file an application, seeking permission to combine with KCS.
 
APRIL 21: CP RULES OUT RAISING BID FOR KCS
 
CP's Chief Executive Keith Creel said the company would not raise its bid for KCS and that bigger rival CN's offer is "not a real deal". Creel said the company was not ready to put its "balance sheet at risk."
 
APRIL 22: CN SHOWS CONFIDENCE IN DEAL GETTING APPROVAL
 
CN informed KCS's board about its confidence in winning regulatory approvals for its offer for the U.S. railroad.
 
APRIL 23: LAWMAKER WARNS AGAINST RAILROAD CONSOLIDATION
 
Senior U.S. lawmaker said the potential acquisition of the KCS should set off "alarm bells" about industry consolidation, warning Wall Street would make money from railroad consolidation, but the U.S. economy and workforce will suffer.
 
APRIL 24: U.S. REGULATOR GIVES CP EARLY WIN IN TAKEOVER WAR
 
The STB granted a waiver to CP's bid for KCS, which means the deal would not be subjected to the tougher railroad merger rules the regulator put in place in 2001. At the same time, KCS said its board had determined that a competing offer from CN could be expected to lead to a "superior proposal."
 
APRIL 26: RAIL CUSTOMERS PICK SIDES IN THE TAKEOVER WAR
 
North America's freight rail customers, from grain shippers to logistics companies, chose sides as the takeover war continued. CN filed 409 letters of support with the STB, almost at par with CP's stated level of support. Some companies like Coca-Cola Co and Conagra were publicly supporting both rail bids.
 
MAY 1: CP OBJECTS TO CN's BID
 
CP filed a formal objection stating CN's rival bid for KCS does not qualify to be exempted from tougher merger rules as the CN/KCS deal would greatly expand the size of the fifth largest U.S. Class 1 railroad.
 
MAY 6: STB APPROVES CP'S VOTING TRUST FOR KCS DEAL
 
The STB approved the voting trust for CP's proposed acquisition of KCS. CP had earlier agreed to bear most of the risk of the merger deal not going through. CP was going to buy KCS shares and place them in an independent voting trust, insulating the acquisition target from its control until the STB cleared the deal.
 
MAY 13: KCS DECLARES CN BID SUPERIOR TO CP DEAL
 
KCS accepted CN's bid, leaving CP with five business days to make a new offer. If CP were to table a new offer, a bidding war could ensue.
 
MAY 14: DOJ SAYS CN BID A GREATER RISK TO COMPETITION
 
The U.S. Department of Justice said CN's bid for KCS appears to pose greater risks to competition than an agreement with CP.
 
MAY 18: SHAREHOLDER URGES CN TO AMEND KCS DEAL
 
Billionaire hedge fund manager Chris Hohn urged CN to abandon its bid for KCS unless the Canadian railroad operator changed its agreement to drop a key feature that could invite more regulatory scrutiny.
 
MAY 20: CP ASKS KCS TO REJECT RIVAL OFFER
 
CP asked the U.S. railroad operator to reject rival CN's takeover offer, saying there was no longer any basis to terminate the CP/KCS agreement.
 
MAY 21: KCS STICKS TO CN OFFER
 
KCS reiterated that CN Railway's offer was "superior".
 
MAY 26: CN TO DIVEST KCS'S 70 MILE RAIL OVERLAP
 
CN Railway agreed to divest KCS's 70 mile rail line between New Orleans and Baton Rouge to eliminate the only overlap between the two railroad operators.
 
AUG. 10: CP CHALLENGES CN WITH US$27 BLN KCS BID
 
CP presented a new US$27 billion offer for U.S. peer KCS.
 
AUG. 12: KCS DOES NOT RECOMMEND CP'S NEW PROPOSAL, STICKS WITH CN
 
KCS's board determined that the unsolicited proposal received from CP does not constitute a "superior proposal" to its agreement with CN.
 
Shreyasee Raj.