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Wall St sees chance of higher bid for Kansas City Southern from Canadian Pacific

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Wall Street is expecting Canadian Pacific to raise its offer for Kansas City Southern even at the cost of more debt to win the bidding war with larger Canadian railroad rival Canadian National.

In the latest twist to the takeover saga, the U.S. railroad operator on Thursday accepted Canadian National’s $33.6 billion offer, leaving Canadian Pacific just five business days to make a new offer.

Analysts said Canadian Pacific was unlikely to let go a chance to be the first railway spanning the United States, Mexico and Canada easily even though it had said it would not leverage its books to outbid Canadian National.

“If CP is willing to compromise a bit more on the leverage ratio, it could…match or potentially beat CNR’s latest offer,” Scotiabank analyst Konark Gupta wrote in a note.

It all started in March when Canadian Pacific agreed to buy Kansas City Southern in a $25 billion cash-and-stock deal, but Canadian National topped the offer in April.

Canadian Pacific’s shares have added about 3% since its March 21 offer, while Canadian National has fallen about 9% from its April 20 bid.

This gives Canadian Pacific room to cut down the size of any potential debt that it would need to outbid its rival. As of Thursday’s close, the implied value of its offer rose to $286 per share from $275 per share, according to Gupta.

That is just $39 per share below Canadian National’s offer of $325 per share. To match it, Canadian Pacific would need to stretch its leverage ratio to as much as five times, from about four times currently.

It had a long-term debt of about C$8 billion ($6.61 billion) as of March 31, while it was C$13 billion for Canadian National.

A final outcome for either combination would still hinge on a regulatory approval by the U.S. Surface Transportation Board (STB), which oversees freight rail.

“The true power in this saga remains where it always has been…with the STB,” Cowen analyst Jason Seidl wrote in a note.

Shares of Kansas City Southern were down 1% and Canadian National 3.5%, while Canadian Pacific was up about 1% in early trading on Friday.

($1 = 1.2096 Canadian dollars)

(Reporting by Ankit Ajmera in Bengaluru; Editing by Arun Koyyur)

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Hundreds more unmarked graves found at erstwhile Saskatchewan residential school

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An indigenous group in Saskatchewan on Thursday said it had found the unmarked graves of an estimated 751 people at a now-defunct Catholic residential school, just weeks after a similar, smaller discovery rocked the country.

The latest discovery, the biggest to date, is a grim reminder of the years of abuse and discrimination indigenous communities have suffered in Canada even as they continue to fight for justice and better living conditions.

Prime Minister Justin Trudeau said he was “terribly saddened” by the discovery at Marieval Indian Residential School about 87 miles (140 km) from the provincial capital Regina. He told indigenous people that “the hurt and the trauma that you feel is Canada’s responsibility to bear.”

It is not clear how many of the remains detected belong to children, Cowessess First Nation Chief Cadmus Delorme told reporters, adding that oral stories mentioned adults being buried at the site.

Delorme later told Reuters some of the graves belong to non-indigenous people who may have belonged to the church. He said the First Nation hopes to find the gravestones that once marked these graves, after which they may involve police.

Delorme said the church that ran the school removed the headstones.

“We didn’t remove the headstones. Removing headstones is a crime in this country. We are treating this like a crime scene,” he said.

The residential school system, which operated between 1831 and 1996, removed about 150,000 indigenous children from their families and brought them to Christian residential schools, mostly Catholic, run on behalf of the federal government.

“Canada will be known as a nation who tried to exterminate the First Nations,” said Bobby Cameron, Chief of the Federation of Sovereign Indigenous Nations, which represents 74 First Nations in Saskatchewan. “This is just the beginning.”

OLD WOUNDS

Canada’s Truth and Reconciliation Commission, which published a report that found the residential school system amounted to cultural genocide, has said a cemetery was left on the Marieval site after the school building was demolished.

The local Catholic archdiocese gave Cowessess First Nation C$70,000 ($56,813) in 2019 to help restore the site and identify unmarked graves, said spokesperson Eric Gurash. He said the archdiocese gave Cowessess all its death records for the period Catholic parties were running the school.

In a letter to Delorme on Thursday, Archbishop Don Bolen reiterated an earlier apology for the “failures and sins of Church leaders and staff” and pledged to help identify the remains.

Heather Bear, who went to Marieval as a day student in the 1970s and is also vice-chief of the Federation of Sovereign Indigenous Nations, recalled a small cemetery at the school but not of the size revealed on Thursday.

“You just didn’t want to be walking around alone in (the school),” she recalled. There was a “sadness that moves. And I think every residential school has that sadness looming.”

The Cowessess First Nation began a ground-penetrating radar search on June 2, after the discovery of 215 unmarked graves at the Kamloops Residential School in British Columbia outraged the country. Radar at Marieval found 751 “hits” as of Wednesday with a 10% margin of error, meaning at least 600 graves on the site.

The Kamloops discovery reopened old wounds in Canada about the lack of information and accountability around the residential school system, which forcibly separated indigenous children from their families and subjected them to malnutrition and physical and sexual abuse.

Pope Francis said in early June that he was pained by the Kamloops revelation and called for respect for the rights and cultures of native peoples. But he stopped short of the direct apology some Canadians had demanded.

Thursday was a difficult day, Delorme told Reuters. But he wants his young children to know “we will get the reconciliation one day with action like today.”

($1 = 1.2321 Canadian dollars)

(Reporting by Anna Mehler Paperny in Toronto and Moira Warburton in Vancouver; Editing by Chizu Nomiyama, Alistair Bell, Grant McCool and Daniel Wallis)

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Teamsters votes to fund and support Amazon workers

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The International Brotherhood of Teamsters, a labor union in the United States and Canada, said on Thursday it has voted to formalize a resolution to support and fund employees of Amazon.com Inc in their unionization efforts.

Amazon did not immediately respond to a request for comment.

(Reporting by Eva Mathews in Bengaluru; Editing by Arun Koyyur)

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Citigroup names new sales head for Treasury and Trade Solutions unit

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Citigroup Inc has named Steve Elms as the new sales head for the bank’s Treasury and Trade Solutions (TTS) unit effective immediately, according to an internal memo shared by a company spokesperson.

Elms, who will oversee the management of the global sales teams, has been involved with the bank’s TTS division for over 10 years, according to his LinkedIn profile.

TTS is a division of the bank’s Institutional Clients group. The segment offers cash management and trade services and finance to multinational corporations, financial institutions and public sector organizations around the world.

(Reporting by Niket Nishant in Bengaluru and David Henry in New York; Editing by Krishna Chandra Eluri)

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