Canadian National Railway (CN) has made a bid for Kansas City Southern (KCS) to create the first US-Canada-Mexico rail network following an earlier agreement by Canadian Pacific Railway (CP) to buy KCS, World Grain reported on 21 April.

CN’s offer of US$33.7bn was higher than CP’s US$29bn bid, according to the report.

CP’s agreed deal with KCS would have created a combined rail company called Canadian Pacific Kansas City (CPKS) that would expand to 32,186km (20,000 miles).

“This deal links origination in production-rich origins that CP has, to new export and domestic consumption markets that we simply just can’t get today,” CP executive marketing officer John Kenneth Brooks was quoted as saying in a conference call with investors on 22 March.

“It gives our corn, soyabean, wheat, canola and products of meals, oils and ethanol … additional domestic markets. Producers and shippers gain routes to the Gulf of Mexico and, of course, into Mexico itself.”

However, CN CEO JJ Ruest said a KCS merger with his company would create a network with “broader reach and greater scale”, expanding the total addressable markets by some US$8bn across the Canadian trans-border, the US domestic sector, and the rapidly growing Mexico-US markets.

The KCS board of directors said it would evaluate CN’s proposal in accordance with the terms of its merger agreement with CP, World Grain reported.