- REUTERS/Brendan McDermid
The head of the House Transportation and Infrastructure Committee has expressed his opposition to a merger between railroad companies Norfolk Southern and Canadian Pacific.
The takeover of Norfolk Southern by Canadian Pacific has been ongoing for months.
Hedge fund investor Bill Ackman of Pershing Square Capital Management has reportedly been a driving force behind the deal, as he holds a large stake in Canadian Pacific.
However, Representative Bill Shuster of Pennsylvania released a statement against the merger on Tuesday.
“I do not believe it is in the best interests of the U.S. freight transportation system, railroad employees, rail shippers and the short line railroads,” said Shuster according to Reuters.
This is just the latest in a series of setbacks for Canadian Pacific after being rebuffed by Norfolk since November.
Ackman, who has been pushing for the deal for some time, according to reports, owns 9.1% of Canada Pacific, and sits on the railroads board of directors. He spoke in December on a conference call advocating for the deal.
This isn’t the first merger proposal for Ackman that has faced pushback. A proposed merger between now-troubled drugmaker Valeant Pharmaceuticals and Allergan pushed by Ackman eventually fell apart in 2014.
After the news, both Norfolk Southern and Canada Pacific are slightly lower for the day by 0.8% and 0.35% respectively.