Montreal-based Canadian National Railway will tap the market for roughly $800 million to fund its upcoming C$1.2 billion acquisition of Wisconsin Central Transportation Corporation. Mark Wallace, director of investor relations, said the company is in discussions with Citigroup to lead the deal but has not made a final decision. Wallace said Citi has an inside track on the lead arranger role because Salomon Smith Barney advised the company on the Wisconsin acquisition. Wallace would not elaborate on structuring details regarding the loan. Officials at Citigroup did not return calls by press time.
Under the terms of the deal, Canadian National will pay $17.15 for each Wisonsin Central share. The company would also assume as much as $400 million in debt from the Rosemont, Illinois-based company. The transaction is expected to be complete by this summer. Canadian National's rail network extends across Canada and south to the Gulf of Mexico.