Rail consolidation unlikely to involve CP for now: CEO

(CPR.ca)

Toronto | Reuters — Canadian Pacific Railway is unlikely to be involved in the consolidation of the North American industry in the short term, CEO Hunter Harrison said on Monday.

Canada’s No. 2 railway, which also has operations in the U.S., discussed a deal with CSX Corp. last year but could not reach an agreement.

“It’s going to happen, but it’s not going to involve us, not any time soon,” Harrison told reporters after a speech in Toronto. “Nobody wants to do a deal.”

Harrison has long argued that consolidation is inevitable over the long term, but his is a minority view. Any deal would face tough regulatory barriers, and even Harrison has said hostile takeovers are very unlikely.

News that talks had broken down with CSX last year fuelled speculation that Norfolk Southern Corp., another major eastern railroad, could be next.

But Norfolk Southern said in October that mergers between major railroads in the U.S. faced too many regulatory hurdles and caused too many problems to be worthwhile at this point.

Allison Martell reports on the transport sector for Reuters from Toronto.

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