Canadian Pacific's plan to set up trust draws US anti-trust concern

Washington

CANADIAN Pacific Railway Ltd's plan to set up a voting trust to allow its chief executive to run Norfolk Southern Corp in advance of its proposed takeover of the US carrier should be rejected, the US Justice Department said.

The trust structure is meant to allow Norfolk Southern investors to be paid for their shares while the US railroad keeps operating on its own pending a regulatory review of Canadian Pacific's unsolicited bid. The Justice Department, in a written statement on Friday, said the trust would fail to keep the railroads separate during the review and would risk harm to current and future competition.