In Monday’s afterhours trading, Kansas City Southern (KSU) shares rose 5.34% to $284.00. At the end of last trading session, the KSU stock price decreased by -0.80% to $269.60. KSU stock recorded a trading volume of 1.64 million shares, below the average daily trading volume of 0.81 million shares for the last 50 days. In the last five days, KSU stock shares have lost 1.51%, but over the last month, they have lost -1.59%.
Since the beginning of the year, KSU stock is up 44.14 percent. Moreover, the price to earnings ratio for KSU is 204.24. As for KSU’s price to cash flow ratio, it stands at 37.92, and its price to sales stands at 8.73. The price of KSU stock rose in extended trades after news emerged that Canadian Pacific is considering a higher bid.
Is KSU Stock in the process of being taken over by someone?
Kansas City Southern (KSU) is a transportation holding company headquartered in Kansas City, Mo., with railroad interests in the U.S., Mexico, and Panama. The Kansas City Southern Railway Company is KSU’s primary US holding and serves the central and south central U.S. As part of KSU’s international holdings, the company has Kansas City Southern de Mexico, S.A. de C.V. based in northeastern and central Mexico and serving Lázaro Cárdenas, Tampico and Veracruz, and 50 percent ownership of the Panama Canal Railway Company, which operates ocean-to-ocean services on the Panama Canal. A unique railway system linking the commercial and industrial centers of North America can be built through KSU’s North American rail holdings and strategic alliances with other North American rail players.
Canadian Pacific (CP) may launch a bidding war with rival Canadian National (CNI) for Kansas City Southern (KSU) if it offers $300 per share, according to a published report Monday. The Wall Street Journal cited people familiar with the matter to report that CP’s board approved the acquisition offer, valuing KSU at about $27 billion. Following the report, after-hours trading for KSU shares was active. Shareholders at both KSU and CNI are scheduled to vote later this month on whether or not to approve CNI’s bid for KSU.
The extensive network of rails that KSU operates in Mexico makes it an attractive provider of automobile transportation from Mexican assembly plants to markets in the Midwest and elsewhere. An earlier agreement for KSU to be acquired by CP for $275 in cash and stock was abandoned after the company abandoned an earlier offer. CNI will reimburse KSU for the $700 million breakup fee paid to CP.
The financial aspect of CNI’s offer:
Kansas City Southern (KSU) shareholders will receive $200 in cash and 1.129 shares of CNI common stock for each share they own. A statement released earlier this spring by the companies stated that KSU shareholders will own 12.65% of the combined business.
