CALGARY, Oct. 30 /CNW/ - Canadian Pacific Railway Limited (TSX/NYSE: CP)
today celebrated the first day of operational control of recently acquired
Dakota, Minnesota & Eastern Railroad Corporation and its subsidiaries: Iowa,
Chicago & Eastern Railroad and Cedar American Rail Holdings.
"This is a significant day for Canadian Pacific, DM&E, IC&E and Cedar
American Rail Holdings as it marks our acquisition of the largest and one of
the most successful regional railroads in North America," said CP President
and Chief Executive Officer Fred Green. "We acquired the DM&E and IC&E
railroads because of the opportunity for sustained double-digit top-line and
EBITDA growth. Given the year-to-date performance, and our current outlook, we
are anticipating that it will surpass our estimate of $0.15 to $0.17
contribution to our 2008 earnings per share."
"The DM&E's speed to market, operational efficiency and organic growth
reinforces our confidence in the strength and potency of this acquisition,"
added Green. "The two networks belong together, the union of which will open
up enhanced opportunities for shippers."
U.S. Senator John Thune noted: "The additional markets that will be
available to rail shippers through Canadian Pacific's extensive rail network
will create jobs, increase the market for South Dakota agricultural goods and
value-added products, and improve our capability to transport products
produced in South Dakota."
"It's clear that South Dakota and the entire upper great plains are in
need of increased shipping infrastructure, and rail can be a cost effective
and efficient means to ship a range of agricultural products," said South
Dakota Congresswoman Stephanie Herseth Sandlin. "I look forward to working
with Canadian Pacific to encourage expanded rail capacity in our state and
provide increased shipping alternatives for our producers."
"We truly appreciate the relationship we've had with the DM&E and look
forward to a great relationship with Canadian Pacific," said Southern
Grainbelt Shippers Association Secretary-Treasurer Randy Rieke from Hanska,
MN. "We see the expanded reach offered through CP into markets we rely upon as
a big plus for our shippers."
South Dakota Wheat Growers CEO, Dale Locken, added further: "We look
forward to extended access to directly-served CP markets in Canada and the
Eastern U.S. The single line haul opportunities will increase fluidity and
enhance rail service."
"With the acquisition complete, we look to start building on the
improvements the DM&E has already made in operating efficiency and safety,"
said CP Executive Vice President and CFO Kathryn McQuade. "Over the next three
years we will invest US$300M into the DM&E and IC&E networks. This capital
investment reinforces our commitment to safe and fluid operations for our
shareholders, our employees, our customers and the communities we serve."
"Our state and region will greatly benefit from an additional Class I
Railroad. South Dakota's rural economy relies on the availability of rail
service to carry manufactured products and agricultural goods to market,"
Senator Thune continued. "I applaud the DM&E and IC&E railroads for their hard
work over the years in establishing a very successful regional railroad, and
look forward to building a relationship with Canadian Pacific who, throughout
the acquisition process, has shown a strong commitment to the people of South
Dakota and our region."
"Our City and the DM&E have enjoyed a great relationship over the years,"
said Huron, SD Mayor David McGirr. "And, we've been impressed with Canadian
Pacific's efforts to work with us over the last year. We were especially
pleased to learn of their plans to invest heavily in track improvement. That
kind of a commitment to our transportation infrastructure is critical to our
region's economic vitality."
The DM&E is the largest regional railroad in the U.S. and the only Class
II railroad that connects and interchanges traffic with all seven Class I
railroads, connecting with Canadian Pacific at Minneapolis, Winona, MN and
Chicago. It is headquartered in Sioux Falls, SD and has approximately 1,100
employees, 2,500 miles of track, including approximately 500 miles of trackage
rights, and rolling stock that includes 7,200 rail cars and 150 locomotives.
The DM&E serves eight states: Illinois, Iowa, Minnesota, Missouri, Nebraska,
South Dakota, Wisconsin and Wyoming with access to Chicago, Minneapolis/St.
Paul, Kansas City and key ports.
The STB first announced its decision on September 30, 2008. Regulations
stipulated a 30-day administrative period whereby registered participants
could file final requests for information, clarification or conditions. The
STB today confirmed its decision and the acquisition process is complete.
About Canadian Pacific
Canadian Pacific, through the ingenuity of its employees located across
Canada and in the United States, remains committed to being the safest, most
fluid railway in North America. Our people are the key to delivering
innovative transportation solutions to our customers and to ensuring the safe
operation of our trains through the more than 900 communities where we
operate. Come and visit us at www.cpr.ca to see how we can put our ingenuity
to work for you. Canadian Pacific is proud to be the official rail freight
services provider for the Vancouver 2010 Olympic and Paralympic Winter Games.
Note on forward-looking information
This news release contains certain forward-looking statements relating
but not limited to the proposed acquisition transaction, anticipated financial
performance and business prospects. Undue reliance should not be placed on
forward-looking information as actual results may differ materially.
By its nature, Canadian Pacific's forward-looking information involves
numerous assumptions, inherent risks and uncertainties, including but not
limited to the following factors: changes in business strategies; general
North American and global economic and business conditions; risks in
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 laws
and regulations, including regulation of rates; changes in taxes and tax
rates; potential increases in maintenance and operating costs; uncertainties
of litigation; labour disputes; risks and liabilities arising from
derailments; timing of completion of capital and maintenance projects;
currency and interest rate fluctuations; effects of changes in market
conditions on the financial position of pension plans and investments, and
various events that could disrupt operations, including severe weather
conditions, security threats and governmental response to them, and
There are factors that could cause actual results to differ from those
described in the forward-looking statements contained in this news release.
These more specific factors are identified and discussed in the Outlook
section and elsewhere in this news release with the particular forward-looking
statement in question.
Except as required by law, Canadian Pacific undertakes no obligation to
update publicly or otherwise revise any forward-looking information, whether
as a result of new information, future events or otherwise.
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