Hapag-Lloyd > Press & Media > CP Ships Archive 2001 > Tax Allocation for Common Shareholders of Canadian Pacific Limited

Tax Allocation for Common Shareholders of Canadian Pacific Limited

05.10.01

Calgary, Canada (05 October 2001) - With the successful completion of Canadian Pacific Limited's (CPL) Plan of Arrangement, the shareholders of CPL will receive, for each Common Share held, the following:

  • 0.684 of a Common Share in PanCanadian Energy Corporation;
  • 0.166 of a Common Share in Fording Inc.;
  • 0.50 of a Common Share in Canadian Pacific Railway Limited;
  • 0.25 of a Common Share in CP Ships Limited;
  • 0.25 of a new Common Share in Fairmont Hotels & Resorts Inc. which will hold CPL's only significant remaining business, Canadian Pacific Hotels & Resorts; and
  • a cheque for any fractional interests in those shares.

In its Arrangement Circular, CPL had indicated that it would be providing a determination of the fair market value of the spin off of its holdings in the four businesses. CPL has determined that a reasonable fair market value of CPL Common Shares at the time of the "share exchange" is $50.37 per common share. This means that the allocation for each of the five companies resulting from the corporate reorganization is as follows:

   Per CPL common share  $  %
 PanCanadian  0.684  $26.65  52.90%
 Fording  0.166  $3.67  7.29%
 CPR  0.5  $11.79  23.41%
 CP Ships  0.25  $2.75  5.46%
 Fairmont Hotels  0.25  $5.51  10.94%
 (as CPL following the spin off)      
   Total  $50.37  100.00%

This estimation is not binding on the Canada Customs and Revenue Agency or any particular CPL Common Shareholder. However, it is recommended that the determination made by CPL Common Shareholders be consistent with the above estimation made by CPL.

Further tax information will be mailed to shareholders by the end of October. PricewaterhouseCoopers will be available to provide assistance to Canadian and U.S. shareholders on tax related questions and a toll free number will be provided for this purpose.

Note: This news release contains forward-looking information. Actual results may differ materially and proposed plans of action could change. The risks, uncertainties and other factors that could influence actual results are described in CPL's Arrangement Circular.

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