Canadian Pacific says railroads will need mergers in future

Staff Writer
Columbus CEO

OMAHA, Neb. (AP) — The CEO of Canadian Pacific still thinks railroad mergers are needed if the industry is to handle more freight, even after the company's bid for Norfolk Southern crumbled under stiff resistance.

Hunter Harrison says that he thinks major railroad mergers will happen eventually and that they'll be successful. He says worsening congestion in Chicago, where the major railroads all meet, will force a change.

Harrison believes some of the opposition to Canadian Pacific's attempted buyout came from people who didn't oppose mergers but worried about the service problems that followed past railroad deals.

Canadian Pacific also said Wednesday that it will increase its dividend to 50 cents, from 35 cents. And it plans to repurchase up to 5 percent of its stock, or about 6.9 million shares.