CALGARY, AB, June 3, 2020 /CNW/ - Canadian Pacific (TSX: CP)
(NYSE: CP) today completed its previously announced acquisition of
the Central Maine & Quebec
Railway US Inc. (CMQ US). Together with the earlier acquisition of
Central Maine & Quebec Railway
Canada Inc. (CMQ Canada), this completes CP's purchase of the
entire CMQ network, which was first announced in November 2019. CMQ US and CMQ Canada will
continue to operate in the U.S. and in Canada respectively as subsidiaries of
CP.
On May 4, 2020, the U.S. Surface
Transportation Board approved CP's acquisition of CMQ US, which
became effective today. This allows CP to integrate CMQ US's 244.2
route-miles of rail line in Maine
and Vermont into CP's network. The
transaction also includes 57.3 route-miles leased from the Maine
Department of Transportation. With the CMQ acquisition, CP is now a
13,000-mile rail network connecting the Atlantic coast to the
Pacific coast across six Canadian provinces and 11 U.S. states.
"This transaction is a generational business opportunity for
CP," said Keith Creel, CP's
President and Chief Executive Officer. "It enables us to serve
customers through a larger coast-to-coast network across
Canada and brings a direct Class 1
freight-rail service to the State of
Maine for the first time in decades. It is with great pride
that I formally welcome CMQ's U.S. employees and customers to the
CP family."
CMQ's network links CP directly to the Atlantic Ocean port of
Searsport, Maine, and to Port
Saint John in New Brunswick
through connections with Eastern Maine Railway and New Brunswick
Southern Railway. As a result, CP now has access to a route that is
approximately 200 miles shorter than the competition, getting
customer shipments from the East Coast into Montreal and Toronto faster. CP plans to invest as much as
$90 million over the next three years
to bring CMQ's rail infrastructure up to Federal Railroad
Administration Class 3 standards.
"Today's expansion of the CP network creates opportunities to
move products in literally every line of business in our
portfolio," said John Brooks, CP's
Executive Vice-President and Chief Marketing Officer. "Through the
precision scheduled railroading model and the commitment of our
people, we will unlock new potential for business and industry
across this region and beyond."
CP reaches the Maine border
using tracks that were formerly part of CMQ Canada from
St-Jean-sur-Richelieu, Que. CP
completed the acquisition of CMQ Canada on December 30, 2019, giving CP access to CMQ
Canada's 236.8-mile route in Quebec.
About Canadian Pacific
Canadian Pacific is a
transcontinental railway in Canada
and the United States with direct
links to major ports on the west and east coasts. CP provides North
American customers a competitive rail service with access to key
markets in every corner of the globe. CP is growing with its
customers, offering a suite of freight transportation services,
logistics solutions and supply chain expertise. Visit cpr.ca to see
the rail advantages of CP. CP-IR
Note on forward-looking information
This news release
contains certain forward-looking information and forward-looking
statements (collectively, "forward-looking information") within the
meaning of applicable securities laws. This news release contains
forward-looking information relating, but not limited to, the
anticipated benefits of the acquisition, including operational
performance and effect on CP's customers, the success of our
business and operations, the anticipated amount of investment over
the next three years to bring CMQ's rails infrastructure up to
Federal Railroad Administration Class 3 standards, and the
potential to unlock new business and industry.
The forward-looking information contained in this news release
is based on current expectations, estimates, projections and
assumptions, having regard to CP's experience and its perception of
historical trends, and includes, but is not limited to,
expectations, estimates, projections and assumptions relating to:
performance of CP's assets and equipment, including the successful
integration of CMQ; applicable laws, regulations and government
policies; the success of our business and operations, anticipated
operational performance, and the anticipated success of the CMQ
transaction, and its anticipated effect on CP and its customers.
Although CP believes the expectations, estimates, projections and
assumptions reflected in the forward-looking information presented
herein are reasonable as of the date hereof, there can be no
assurance that they will prove to be correct.
Undue reliance should not be placed on forward-looking
information as actual results may differ materially from those
expressed or implied by forward-looking information. By its nature,
CP's forward-looking information involves inherent risks and
uncertainties that could cause actual results to differ materially
from the forward looking information, including, but not limited
to, the following factors: risks associated with the successful
integration of CMQ; changes in business strategies; general North
American and global economic, credit and business conditions; risks
associated with agricultural production, such as weather conditions
and insect populations; the availability and price of energy
commodities; the effects of competition and pricing pressures;
industry capacity; shifts in market demand; changes in commodity
prices; uncertainty surrounding timing and volumes of commodities
being shipped via CP; inflation; changes in laws, regulations and
government policies, including regulation of rates; changes in
taxes and tax rates; potential increases in maintenance and
operating costs; changes in fuel prices; uncertainties of
investigations, proceedings or other types of claims and
litigation; labour disputes; risks and liabilities arising from
derailments; transportation of dangerous goods; timing of
completion of capital and maintenance projects; currency and
interest rate fluctuations; trade restrictions or other changes to
international trade arrangements; climate change; various events
that could disrupt operations, including severe weather, such as
droughts, floods, avalanches and earthquakes, and cybersecurity
attacks, as well as security threats and governmental response to
them, and technological changes; and the pandemic created by the
outbreak of the novel strain of coronavirus (and the disease known
as COVID-19) and resulting effects on economic conditions, the
demand environment for logistics requirements and energy prices,
restrictions imposed by public health authorities or governments,
fiscal and monetary policy responses by governments and financial
institutions, and disruptions to global supply chains. The
foregoing list of factors is not exhaustive. These and other
factors are detailed from time to time in reports filed by CP with
securities regulators in Canada
and the United States. Reference
should be made to "Risk Factors" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations -
Forward-Looking Statements" in CP's annual and interim reports on
Form 10-K and 10-Q.
The forward-looking information contained in this news release
is made as of the date hereof. Except as required by law,
CP undertakes no obligation to update publicly or otherwise
revise any forward-looking information, or the foregoing
assumptions and risks affecting such forward-looking information,
whether as a result of new information, future events or
otherwise.
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SOURCE Canadian Pacific