This case is about ECONOMICS, ECONOMY
PUBLICATION DATE: April 13, 1998
Responding to 21st Century Financial Crisis Case Solution
The owning companies of the 1st and 3rd largest railroads in East USA, CSX (Virginia) and Consolidated Rail (Pennsylvania) express intentions to merge on the 15th of October 1996 in a partnership worth $8.3 billion!
Partnerships such as these are becoming frequently more common in the railroad industry, and promise to change its face forever. Students should realize that this is a two-tiered acquisitionoffer, and must consider whether it is appropriate to tender shares into the front end. They must value Conrail as an acquisition target and understand the construction of the offer of CSX to make this decision.