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6/28/2001



Rail News: Rail Industry Trends

Merrill Lynch to enable investors to hold shares in all five CP firms post-split


Merrill Lynch subsidiaries Merrill Lynch Canada Inc. and Merrill Lynch, Pierce, Fenner & Smith Inc. June 27 announced plans to offer CP HOLDRS depositary receipts in connection with Canadian Pacific Corp.'s split into five separate operating businesses.
HOLDRS represents an investor's ownership interest in a number of companies through a single, exchange-traded depositary receipt. CP gave Merrill Lynch exclusive permission to use the corporation's name to develop CP HOLDRS.
The receipts initially would represent ownership in CP; after the corporation's reorganization, CP HOLDRS would represent shares of all five companies: PanCanadian Petroleum Ltd., Canadian Pacific Railway, Fording Inc., CP Ships Holdings Inc. and Fairmont Hotels & Resorts Inc.
Current CP shareholders would receive equity shares of each successor company post-split; CP HOLDRS owners would retain the same rights and privileges as shareholders of the five successor companies.
Subject to regulatory approval, Merrill Lynch plans to begin trading CP HOLDRS in the United States and Canada in the third quarter — immediately before CP's planned September split. Before trading begins, Merrill Lynch would enable CP shareholders to deposit all or a portion of their common stock in exchange for CP HOLDRS.


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