Canadian Pacific Railway Limited (CPR) and Kansas City Southern (KCS) have announced that they have entered into a merger agreement, under which CPR has agreed to acquire KCS.

The two railroads will be combined as a result of the agreement to become the first rail network linking the US, Mexico, and Canada. With the transaction customers will be connected by CP and KCS via single-network transportation services between locations on their respective systems in Mexico and the South Central US and point on CP's system throughout Canada, the US Midwest, and the US Northeast. It is also expected to create jobs across the combined network.

The transaction represents an enterprise value of approximately USD$29 billion, which includes the assumption of US$3.8 billion of outstanding KCS debt.