\nKansas City Southern (NYSE: KSU) (\u201cKCS\u201d) today announced that its Board of Directors has unanimously determined, after consultation with the Company\u2019s outside legal and financial advisors, that the unsolicited proposal received from Canadian Pacific Railway Limited (TSX: CP) (NYSE: CP) (“CP”) on August 31, 2021, to acquire KCS in a cash and stock transaction valued by CP at $300 per KCS share could reasonably be expected to lead to a \u201cCompany Superior Proposal\u201d as defined in KCS\u2019s merger agreement with CN (TSX: CNR) (NYSE: CNI).\n<\/p>\n
\nKCS intends to provide CP with nonpublic information and to engage in discussions and negotiations with CP with respect to CP\u2019s proposal, subject in each case to the requirements of the CN merger agreement.\n<\/p>\n
\nKCS remains bound by the terms of the CN merger agreement, and KCS\u2019s Board has not determined that CP\u2019s proposal in fact constitutes a Company Superior Proposal as defined in the merger agreement with CN. In addition, KCS notes that there can be no assurance that the discussions with CP will result in a transaction.\n<\/p>\n
\nAs previously announced on May 21, 2021, KCS entered into a merger agreement with CN, pursuant to which CN agreed to acquire KCS in a stock and cash transaction valued at $325 per KCS share based on the CN and KCS closing prices on May 12, 2021.\n<\/p>\n
\n\u200eBofA Securities and Morgan Stanley & Co. LLC are serving as financial advisors to Kansas City Southern. Wachtell, Lipton, Rosen & Katz, Baker & Miller PLLC, Davies Ward Phillips & Vineberg LLP, WilmerHale, and White & Case, S.C. are serving as legal counsel to Kansas City Southern.\n<\/p>\n
About Kansas City Southern<\/b><\/p>\n
\nHeadquartered in Kansas City, Mo., Kansas City Southern (KCS) (NYSE: KSU) is a transportation holding company that has railroad investments in the U.S., Mexico and Panama. Its primary U.S. holding is The Kansas City Southern Railway Company, serving the central and south central U.S. Its international holdings include Kansas City Southern de Mexico, S.A. de C.V., serving northeastern and central Mexico and the port cities of L\u00e1zaro C\u00e1rdenas, Tampico and Veracruz, and a 50 percent interest in Panama Canal Railway Company, providing ocean-to-ocean freight and passenger service along the Panama Canal. KCS’ North American rail holdings and strategic alliances with other North American rail partners are primary components of a unique railway system, linking the commercial and industrial centers of the U.S., Mexico and Canada. More information about KCS can be found at www.kcsouthern.com<\/a>.\n<\/p>\n Forward-Looking Statements <\/b><\/p>\n \nCertain statements included in this news release constitute \u201cforward-looking statements\u201d within the meaning of the United States Private Securities Litigation Reform Act of 1995 and under Canadian securities laws, including statements based on management\u2019s assessment and assumptions and publicly available information with respect to KCS, regarding the proposed transaction between CN and KCS, the expected benefits of the proposed transaction and future opportunities for the combined company. By their nature, forward-looking statements involve risks, uncertainties and assumptions. CN and KCS caution that their assumptions may not materialize and that current economic conditions render such assumptions, although reasonable at the time they were made, subject to greater uncertainty. Forward-looking statements may be identified by the use of terminology such as \u201cbelieves,\u201d \u201cexpects,\u201d \u201canticipates,\u201d \u201cassumes,\u201d \u201coutlook,\u201d \u201cplans,\u201d \u201ctargets,\u201d or other similar words.\n<\/p>\n \nForward-looking statements are not guarantees of future performance and involve risks, uncertainties and other factors which may cause actual results, performance or achievements of CN, or the combined company, to be materially different from the outlook or any future results, performance or achievements implied by such statements. Accordingly, readers are advised not to place undue reliance on forward-looking statements. Important risk factors that could affect the forward-looking statements in this news release include, but are not limited to: the outcome of the proposed transaction between CN and KCS; the parties\u2019 ability to consummate the proposed transaction; the conditions to the completion of the proposed transaction; that the regulatory approvals required for the proposed transaction may not be obtained on the terms expected or on the anticipated schedule or at all; CN\u2019s indebtedness, including the substantial indebtedness CN expects to incur and assume in connection with the proposed transaction and the need to generate sufficient cash flows to service and repay such debt; CN\u2019s ability to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction; the possibility that CN may be unable to achieve expected synergies and operating efficiencies within the expected time-frames or at all and to successfully integrate KCS\u2019 operations with those of CN; that such integration may be more difficult, time-consuming or costly than expected; that operating costs, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers or suppliers) may be greater than expected following the proposed transaction or the public announcement of the proposed transaction; the retention of certain key employees of KCS may be difficult; the duration and effects of the COVID-19 pandemic, general economic and business conditions, particularly in the context of the COVID-19 pandemic; industry competition; inflation, currency and interest rate fluctuations; changes in fuel prices; legislative and\/or regulatory developments; compliance with environmental laws and regulations; actions by regulators; the adverse impact of any termination or revocation by the Mexican government of KCS de M\u00e9xico, S.A. de C.V.\u2019s Concession; increases in maintenance and operating costs; security threats; reliance on technology and related cybersecurity risk; trade restrictions or other changes to international trade arrangements; transportation of hazardous materials; various events which could disrupt operations, including illegal blockades of rail networks, and natural events such as severe weather, droughts, fires, floods and earthquakes; climate change; labor negotiations and disruptions; environmental claims; uncertainties of investigations, proceedings or other types of claims and litigation; risks and liabilities arising from derailments; timing and completion of capital programs; and other risks detailed from time to time in reports filed by CN with securities regulators in Canada and the United States. Reference should also be made to Management\u2019s Discussion and Analysis in CN\u2019s annual and interim reports, Annual Information Form and Form 40-F, filed with Canadian and U.S. securities regulators and available on CN\u2019s website, for a description of major risk factors relating to CN. Additional risks that may affect KCS\u2019 results of operations appear in Part I, Item 1A \u201cRisks Related to KCS\u2019 Operations and Business\u201d of KCS\u2019 Annual Report on Form 10-K for the year ended December 31, 2020, and in KCS\u2019 other filings with the U.S. Securities and Exchange Commission (\u201cSEC\u201d).\n<\/p>\n \nForward-looking statements reflect information as of the date on which they are made. CN and KCS assume no obligation to update or revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs, unless required by applicable securities laws. In the event CN or KCS does update any forward-looking statement, no inference should be made that CN or KCS will make additional updates with respect to that statement, related matters, or any other forward-looking statement.\n<\/p>\n No Offer or Solicitation<\/b><\/p>\n \nThis news release does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended.\n<\/p>\n Additional Information and Where to Find It<\/b><\/p>\n \nIn connection with the proposed transaction, CN has filed with the SEC a registration statement on Form F-4 to register the shares to be issued in connection with the proposed transaction, and the registration statement has been declared effective. CN has filed with the SEC its prospectus and KCS has filed with the SEC its definitive proxy statement in connection with the proposed transaction, and the KCS proxy statement is being sent to the stockholders of KCS seeking their approval of the merger-related proposals. This news release is not a substitute for the registration statement, the prospectus, the proxy statement or other documents CN and\/or KCS may file with the SEC or applicable securities regulators in Canada in connection with the proposed transaction.\n<\/p>\n \nINVESTORS AND SECURITY HOLDERS ARE URGED TO READ THE REGISTRATION STATEMENT, THE PROSPECTUS, THE PROXY STATEMENT AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC OR APPLICABLE SECURITIES REGULATORS IN CANADA CAREFULLY IN THEIR ENTIRETY IF AND WHEN THEY BECOME AVAILABLE (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS THERETO) BECAUSE THEY CONTAIN AND WILL CONTAIN IMPORTANT INFORMATION ABOUT CN, KCS AND THE PROPOSED TRANSACTION. Investors and security holders may obtain copies of these documents (if and when available) and other documents filed with the SEC and applicable securities regulators in Canada by CN free of charge through at www.sec.gov<\/a> and www.sedar.com<\/a>. Copies of the documents filed by CN (if and when available) will also be made available free of charge by accessing CN\u2019s website at www.CN.ca<\/a>. Copies of the documents filed by KCS (if and when available) will also be made available free of charge at www.investors.kcsouthern.com<\/a>, upon written request delivered to KCS at 427 West 12th Street, Kansas City, Missouri 64105, Attention: Corporate Secretary, or by calling KCS\u2019 Corporate Secretary\u2019s Office by telephone at 1-888-800-3690 or by email at corpsec@kcsouthern.com<\/a>.\n<\/p>\n Participants<\/b><\/p>\n \nThis news release is neither a solicitation of a proxy nor a substitute for the registration statement, the prospectus, the proxy statement or other filings that may be made with the SEC and applicable securities regulators in Canada. Nonetheless, CN, KCS, and certain of their directors and executive officers and other members of management and employees may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information about CN\u2019s executive officers and directors is available in its 2021 Management Information Circular, dated March 9, 2021, as well as its 2020 Annual Report on Form 40-F filed with the SEC on February 1, 2021, in each case available on its website at www.CN.ca\/investors\/<\/a> and at www.sec.gov<\/a> and www.sedar.com<\/a>. Information about KCS\u2019 directors and executive officers may be found on its website at www.kcsouthern.com<\/a> and in its 2020 Annual Report on Form 10-K filed with the SEC on January 29, 2021, available at www.investors.kcsouthern.com<\/a> and www.sec.gov<\/a>. Additional information regarding the interests of such potential participants is or may be included in the registration statement, the prospectus, the proxy statement or other documents filed with the SEC and applicable securities regulators in Canada if and when they become available. These documents (if and when available) may be obtained free of charge from the SEC\u2019s website at www.sec.gov<\/a> and from www.sedar.com<\/a>, as applicable.\n<\/p>\n View source version on businesswire.com: <\/span>https:\/\/www.businesswire.com\/news\/home\/20210904005009\/en\/<\/a><\/span><\/p>\n Media \nJoele Frank, Wilkinson Brimmer Katcher Investment Community \nMacKenzie Partners, Inc. KEYWORDS:<\/b> Missouri United States North America<\/p>\n INDUSTRY KEYWORDS:<\/b> Trucking Rail Maritime Air Transport<\/p>\n<\/p>\n
\n<\/span><\/b>
C. Doniele Carlson
\n
KCS Corporate Communications & Community Affairs
\n
(816) 983-1372
\n
dcarlson@kcsouthern.com <\/a><\/p>\n
\n
Tim Lynch \/ Ed Trissel
\n
(212) 355-4449\n<\/p>\n
\n<\/span><\/b>
Ashley Thorne
\n
Vice President
\n
Investor Relations
\n
(816) 983-1530
\n
athorne@kcsouthern.com <\/a><\/p>\n
\n
Dan Burch \/ Laurie Connell
\n
(212) 929-5748 \/ (212) 378-7071
\n
dburch@mackenziepartners.com
\n<\/a>
lconnell@mackenziepartners.com<\/a><\/p>\n
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